Chain Pharmacy Seeking Licence For Christchurch

Press, Volume XCI, Issue 27639, 21 April 1955, Page 9

Chain Pharmacy Seeking Licence For Christchurch

Boots the Chemists (New Zealand), Ltd., a subsidiary of the British company which has operated in New Zealand since 1936, yesterday sought before the Pharmacy Authority (Judge Stillwell) permission to open a shop at 748 Colombo street, Christchurch. The application, the first of its kind under the Pharmacy Amendment Act of 1954, was opposed by six Christchurch chemists on the ground that the act did not allow the application, and on the ground that Christchurch chemists already provided a full and

Mr H. R.. C. Wild, of Wellington, appeared for the applicant company, and Dr. R. G. McElroy, of Auckland, with him Mr T. A. Gresson, for the objectors. In 1936 Boots came to New Zealand and bought shops in Auckland and Wellington, Mr Wild said. In 1937, an industrial plan for the pharmaceutical industry was formulated under the Industrial Efficiency Act. and it was necessary to obtain a licence to open any retail pharmacy. In 1938, Boots obtained licences fqr Palmerston North and Dunedin, but were refused a licence for Invercargill. During and immediately after the war, the company made no application for extension, said Mr Wild. In 1951, it applied unsuccessfully for a licence in Wanganui, in 1953 obtained a licence in Hamilton, and last year obtained one at Lower Hutt. Size of Proposed Shop

For 17 years, it had had shops in all the main centres except Christchurch, and it was now considered that extension to Christchurch was warranted, Mr Wild said. The shop proposed in Christchurch was approximately the size of the Lower Hutt shop, the smallest of the three varieties. The pro?osed staff was eight, compared with 6 at Dunedin and 29 at Auckland and Wellington. Contending that the public interest would be served by the opening of the shop in Christchurch, Mr Wild said that letters had been sent to the Wellington and Dunedin offices of Boots by Christchurch persons, who had found they could not get the goods required elsewhere. The company’s policy was not to criticise other chemists, but it believed it was able to provide a fuller service and offer a wider range of goods, he said. It dispensed social security prescriptions and stocked every band of proprietary medicine, as did other chemists, out it also stocked its own patent medicines, at a slightly lower cost, other British lines, mostly in less demand, and was able to supply a wider range of surgical equipment than the ordinary chemist Effect on Other Chemists Andrew Wellington Boyce, deputymanaging director of 1 the company, produced letters received by the company from Christchurch. Since December 26, letetrs had been received, two from chemists. Twelve of them were asking for saccharin. The Dunedin office had had six requests so far this year. Mr Boyce quoted previous decisions supporting his view that suburban chemists were not 1 affected by the opening of Bodts, but admitted in cross-examination that the Impact on city chemists’ business would be “fairly severe.”

Questioned by Dr. McElroy, Mr Boyce said that the company’s application to operate in Dunedin was granted on the ground that Dunedirvpharmacies were not up tn date. Christchurch/pharmacies, he said, had .as high h standard as anywhere else m New To*further questSona, Mr Boyce said the New : Zealand company had a capital £60,000, • of Which 50,920 shares were held by Boots Pure Drug Company, andthe 80 by local directors and officers. New Zealand was ’ the only place other than Britain where there was a chain, of retail Shops. , a . ■ • . The company’s policy was not to

open in any centre with a population or fewer than 20,000. Mr Boyce said. He estimated the Christchurch shop’s turnover at £25.000 in the first year, increasing to £35.000 in the third. He agreed that his company’s average of dispensing to total turnover was 20 per cent, below the Dominion average. but when re-examined by Mr Wild, said his company’s turnover in toilet goods was 33 per cent., against a likely average of 17 per cent., so that the fact that dispensing accounted for only 15 per cent, did not mean that the company was not taking 'its share of dispensing. Quality of Firm’s Supplies On visits to England he had seen Boot’s organisation, said Philip Stanley Foster, a surgeon, and chairman of the New Zealand Medical Council. He had discussed Boots’ supplies with senior members of the Christchurch Hospital medical staff, and learned that the standard of their goods -in England was high. He did not criticise the service given by Christchurch chemists—they had given good service—but he thought it logical that a big firm supplying a lot of goods necessary to the growing community should be established in Christchurch. To Mr Gresson, Mr Foster said he knew of not infrequent cases of patients being unable to obtain special surgical requirements. It had always been difficult to get adequate fittings of trusses. It was difficult to find someone to fit trusses. , , Nancy Northcroft, regional planning officer for tfoe Christchurch Regional Planning Authority, and formerly Town Planning Officer for the Christchurch City Council, was called by the objectors to give evidence. She said it was recognised in.Jowq planning that shops tended to follow the population . The first business 4o be»iablished in a new area was usually the mixed business, and.later.tbs tobacconist, hairdresser, chemist? or butcher. In other words, a considerable proportion of the shooping needs of ntew areas was catered for locally, said Miss Northcroft. However, people required to go to the centre of the. city to wotrk. or to visit departmental stores and banks, and there was a recognised tendency for them to buv as they were going to and from work. Some of the impact of the increased population in the suburbs was therefore reflected in the centre of the city, and the trade in it, said Miss Northcroft. This particularly affected clothing and furniture businesses, and te a much smaller extent the-. butcher, or chemist.

Existing Pharmacies James Arthur Sydney Marr is, a public accountant, and secretary of the Canterbury division of the Chemists* Service Guild of New Zealand, said there were 20 pharmacies within a radius of half a mile of Boots’ proposed premises, and nine were within 250 yards. Over the last 20 years there had been a steady increase in suburban pharmacies, and only one licence had been granted in the central area in f recent years. The increased number of suburban pharmacies had restricted the increase in turnover in city pharmacies; In spite of the considerable increase in population, said Mr Marris. Dr. McElroy, in his submissions, said that Boots were absolutely precluded under the amendment to the act be- ! cause the parent company was a wholesale one. The act placed statutory bias against mujtitple-owned pharmacies, so long as'■ independent chemists were giving a full, efficient, and economic service to the public. “I submit that the existing chemists giving a full and efficient service.** said Ur. McElroy. “Further, if Boots are permitted to open, the turnover would be so great that it would put one pharmacy ottt of business and seriously affect the stability of the remaining ’bbjbetors.’* ‘ vJiidge Stillwell reserved his decision.