Banks help save pharmacies from receivership

The number of pharmacies going into receivership has reduced, thanks to sympathetic treatment from banks.

Many are in distress and are on bank watchlists, says Luci Palaghia, a partner with insolvency and restructure consultants Ferrier Hodgson.

But the good news is the banks are often willing to help pharmacies turn around, rather then force them into administration as would have happened in the past.

Five years ago, 10 to 15 pharmacy businesses a year went into administration through Ferrier Hodgson. But there had been none in the last 12 months.  

“Pleasingly, the banks, in particular the big four, are now more willing to assist customers deal with their financial difficulties,” Ms Palaghia says.

In some cases, banks are willing to finance value-adding transformation initiatives, such as funding rebranding or relocation.

“Enforcement doesn’t always