Propaganda Cum Distribution (PCD) is a term used in the pharma industry. This model is popularly embraced in India and other nations for easy distribution and marketing of drugs. It is a unique business design that allows pharmaceutical firms to grow their market share without greatly investing capital or setting up new offices.
What Is PCD?
Propaganda Cum Distribution (PCD) refers to an arrangement where local distributors or franchises are engaged to promote and distribute pharmaceutical products within their allocated territories. These agents work under the name of the parent company, thereby benefiting from its existing trust and brand image. For small and medium-sized pharmaceutical companies seeking rapid and cost-effective territorial expansion, the PCD model can prove particularly beneficial.
Features of PCD Pharma Model
- Franchise System: This model involves a pharmaceutical company providing franchise rights to a distributor or individual who sells and distributes products within a designated geographical area.
- Brand Utilization: By this, the distributors are able to use the brand name and trademarks of the parent company thereby taking advantage of its existing brand recognition and customer trust.
- Exclusive Rights: Usually this means selling only one’s products within a specific geographical area for example can reduce competition and enhance market penetration.
- Marketing Support: The parent firm usually provides some marketing materials, promotional aids etc. if necessary franchisees are trained on how they can effectively publicize their goods being sold.
- Low Investment: This method does not require huge amount of capital from franchisees as compared with setting up full-fledged pharmaceutical manufacturing or distribution plant.
- Wide Product Range: Through many different types of pharmaceuticals available, franchisees can target a great variety of clients’ needs to ensure more customers.
Advantages of the PCD Pharma Model
Explosion in the market
Pharmaceutical firms can spread their wings into new markets without massive investments in infrastructure.
It Is Cost Effective
This crops out the million dollar burden on the parent company as all marketing and distribution costs are borne by distributors or franchisees.
Neighborhood Expertise
Most of the time, Franchisees have more understanding about local market dynamics, customer tastes and preferences and even regulatory requirements that enhance better marketing strategies for these products.
Flexibility
The model posses flexibility for growth with an opportunity to increase number of franchisees when the enterprise expands.
Sharing Of Risk
This spreads financial risk between a franchiser and its child organization hence reducing overall peril to both partners.
Conclusion
In conclusion, the PCD (propaganda cum distribution) model has changed how pharmaceutical companies extend their operations. As such, the firms can achieve rapid market penetration and development by capitalizing on local expertise while minimizing capital investment. Nonetheless, being cautious about whom to partner with for franchises, maintaining strict product quality standards is necessary for long-term success that would protect their brand. Therefore, it is no wonder that most companies in the pharmaceutical industry still use the PCD Pharma model because of its many benefits.
