Medicine man rattles cages of capital's pharmacy trade

Irish people living outside the capital have long accused Dubliners - or even worse, country blow-ins to Dublin - of living in a consumer goldfish bowl, in which Ireland begins in Bloomfield in Dún Laoghaire, ends at the Swords Pavilion and revolves around Grafton Street.chain, says group is ready for challenge ofoperating its first outlet in Dublin city

It's rumoured that beyond that there are perfectly acceptable shopping opportunities, but still the Dundrum devotees have recurring nightmares about being stranded down the country for the weekend, hundreds of miles from Henry Street and relying on a curious amalgamation of shop, post office and pub for all their retail needs.

Sam McCauley sees things differently. Founder and chief director of the country's largest Irish-owned chain of pharmacies, he believes that the opening of his first outlet in Dublin's city centre is just a further step in the growth of a brand that has already saturated most of the southern part of the island.

"There is a perception that Dublin is Ireland, yes, and that it will round the circle as a group to have some city centre branding in a prime location," he says.

"But it wasn't about ego. Like all our other openings, we asked did it meet our criteria and would it give us a return on our investment?

"We have looked at several high-profile posts in the other major shopping centres and have had ample expansion opportunities in the past but this is the first location that most met our criteria."

The latest Sam McCauley outlet will open on August 1st in the St Stephen's Green shopping centre, bringing the nationwide total to 22. McCauley has built his reputation across the south-east all the way to Tralee on large-scale premises, which aim to "create a bit of theatre".

The flagship store in Redmond Square, Wexford town, covers 20,000sq ft (compared to an average of about 1,000sq ft) and as well as the core pharmacy services, incorporates a hair salon, beauty spa, medical centre and adjacent O'Brien's sandwich bar.

McCauley runs similar-sized "one-stop health and beauty shops" in his hometown, Enniscorthy, and in Clonmel, Midleton, Carlow and Blackpool, Douglas Court and Mahon Point in Cork as well as smaller premises across the south.

The group employs 520 staff across, with an annual payroll of €8.25 million and annual turnover is projected at €60 million, up from €48 million the previous year. McCauley expects to hit €100 million by 2008 at the latest.

The latest offering provides a new challenge for the company though, as it will be significantly smaller than the department stores with which McCauley has made his name.

The city centre also lacks the community ethos found in a provincial town. While McCauley's distinct stores may retain customer loyalty in residential or rural areas and customers will look out for what they feel is best, busy commuters and city centre shoppers just want the nearest neon green cross. McCauley is unfazed by the challenge.

"There is an expectation of the offer that we provide. Obviously, you've got to cut your cloth to measure," he says.

"This will be more of a rapid and sophisticated service for the busy executive on the run. I think you'll notice that the sharpness and the ambience of professionalism."

Given the success of McCauley's superstores, it may have made more sense to locate in one of the larger shopping centres, in particular Dundrum, but he has stuck to the same criteria that has worked well so far, with no closures to date, and insists prestige is not a factor.

"There is a little bit of madness going on in the pharmacy market at the moment, in my view, with the tendering process for units," he says.

"The prices have been excessive and have reached the law of diminishing returns. We have just walked away from the offers, even having been given first refusal. In my view, the amounts being sought didn't make economic sense."

That factor hasn't stopped the rapid growth of openings in Dublin's city centre. In the past six months alone three new premises have opened within five minutes walk of Trinity College - and each other.

"Watch those spaces. Pharmacies are opening and closing rapidly. There's been several unsuccessful openings, where people haven't really done their homework," says McCauley.

"Because of the high price being paid for going concerns, people are choosing the greenfield approach, and you have to be cautious in doing that because with high rents and high professional staff costs, you have the propensity to lose vast amounts of money before you turn the corner, if in fact you ever do.

"I'll wager if you watch a lot of the greenfield openings in the greater Dublin area that you will see a lot of closures because they're unsustainable. If you have saturation of pharmacies, you'll have closures."

McCauley was a pharmacist before he was an entrepreneur - he was shortlisted for last year's Ernst & Young Entrepreneur of the Year award - but while the latter was something he has naturally gravitated toward, he had little choice in the former.

"My father had a place in Enniscorthy and I was a pharmacist by conception rather than conviction. I went up to UCD in 1967, and when I graduated, I took a position in the Widow Hills' pharmacy in Dungarvan," he says.

"At the time, Ireland was almost third world, it's hard to imagine. It was so slow and it was anything but challenging and I wasn't ready to go back to the family business just yet."

"But my dad, as was the way of Irish dads at the time, had me virtually contracted to go back when he wanted me to. In the meantime I was going to do something which would challenge me."

One letter to the Canadian embassy and six weeks later, McCauley was working in St Michael's hospital in downtown Toronto, where he met his wife-to-be Leslie, also a pharmacist.

On his return to Ireland in 1978 he came back to Enniscorthy, where he intended on pursuing his other career, in politics.

"I had been a member of Fianna Fáil from quite a young age and one of my ambitions had been to come back and pursue a political career," he says.

"Some kids want to be an airline pilot, my vocation was to go into politics. I felt that I could make a real contribution to the country. God knows, it was in the need of it at the time.

"I stood in front of the delegates for one of the general elections in the early 1980s and, probably luckily enough, I got an underwhelming response, which effectively ended my political career.

"I count myself fortunate because I know now that it wouldn't have suited me. Certainly, my strong views would have made me unelectable and would have posed some problems for the party whip."

Although McCauley never made it as far as Leinster House, he was on the Enniscorthy Urban District Council for nine years and was the pharmacy representative of the South Eastern Health Board and subsequently the chairman.

"My ambitions would have been intercounty hurling (he played for Wexford minors in 1967), politics and maybe third, pharmacy," says McCauley.

His political work kept him very busy throughout the 1980s and by the early 1990s, he was pretty sure that there would be no shock late call-up from the Wexford County Board to take on Kilkenny in the Leinster final. He turned his attention towards expansion, at a time when the Republic's economy was still very shaky.

"For a long time I had felt that, given the range of products on offer, we had the potential to create a bit of theatre in the store, especially given that most of our customers are female.

"We made our first serious expansion in 1991. The economy wasn't that buoyant at the time and it was seen as somewhere between foolish and mad by a lot of people.

"We moved to a much larger site in Enniscorthy. I wasn't taking inspiration from my time abroad or what was being done elsewhere. It was an intuitive thing as to what would capture the imagination of the customers, expanding the services and products to eventuallyreach the flagship model in Redmond Square."

He can't single out one store offering that has created more success than any of the others.

"All the services which we offer create a synergy across the store. I would ask you which is the most important leg of a three-legged stool?" he says.

"Granted, the hair studio is one we wouldn't repeat. It seemed like a good idea at the time, but we have since franchised it out."

McCauley was active as a pharmacist until six or seven years ago, when he decided to give more time to the group's busiest expansion period.

However, he does see life beyond the counter.

"I have a terrific team that have helped me build the business. My executive team has been with me since the first expansion phase in 1991 and I believe that I will pass the baton onto them. I don't want to die with my boots on," he says.