If you’re looking to break into the business of pharmacy, you’ll have to break open your piggy bank first. Ask any pharmacy owner — whether they’re new to the scene or a seasoned pro — and they’ll tell you that opening a new pharmacy requires time, energy, and of course, a considerable amount of cash.

In fact, NCPA’s America’s Pharmacist reports, “Properly funded startup [pharmacies] can cost close to $500,000.”

High out-of-pocket costs mean that, if you’re looking to get into pharmacy, you’ll probably spend a pretty penny. But despite the high start-up costs, ownership can prove to be a smart business decision.

As NCPA explains, “Many pharmacists become interested in starting a pharmacy from scratch because the initial investment will be smaller than acquiring an existing pharmacy for $1 million or more.” 

It makes sense, then, that ownership is a financially sound decision for many pharmacists. And it may be right for you. With your finances in place, you can take a leap of faith and invest in a new store, along with equipment, inventory, and any other items your pharmacy may need.

But where do you get the initial investment? Do you call on friends, family, or look to other lenders?

Every pharmacy is different, but with the right financing behind you, you can open your new business while keeping your bank account safe.

Read on to explore your financing options:

Types of Financing for Pharmacy Owners

1. Traditional Loans

The most common way to finance your pharmacy is through a lender, like a bank or credit union. Traditional lenders are a safe, steady option for pharmacy owners just starting out. Lenders offer several types of loans, but the three most common are:

  • Business line of credit — A business line of credit gives your pharmacy access to funds as you need them. With this type of financing, you can borrow up to the value of your credit line. Then, after paying back that amount (plus interest), you can start borrowing again. A line of credit is particularly helpful for managing your working capital and cash flow, which is why most small businesses rely on it to get started.

  • Long-term loan — Long-term loans are ideal for purchases that will take you a while to repay (i.e., an independent pharmacy). Long-term loans typically have repayment terms of 2-10 years and reasonable interest rates, depending on your credit score.

  • Short-term loans — Once you have your pharmacy up and running, you’ll proably want to make smaller purchases (which may require a smaller loan). Purchases might include new tools, equipment, a great pharmacy software system, or any other expense you can’t pay for right now but can afford in installments. Short-term loans operate like lines of credit, but they aren’t restricted to preset amounts. On the other hand, they take longer to get approval for — which might put you and your pharmacy in a pinch.

2. Small Business Administration (SBA) Loans

The U.S. Small Business Administration (SBA) gives out more than $40B in loans every year — helping over 61,000 businesses get off the ground.

Many of those loans go out to pharmacy owners, which makes the SBA another excellent option for you to consider. The SBA’s flagship loan option is the (7)a loan, which is common for businesses that need working capital or equipment financing.

The SBA doesn't stop there, though. If you need help covering your new brick-and-mortar, they offer 504 loans; and if you need to make smaller purchases, they offer microloans.

3. Commercial Real Estate (CRE) Loans

When it comes to financing your pharmacy location, the SBA’s 504 isn’t your only option. Other lenders (like banks and credit unions) offer commercial real estate loans to help you get the space you need. CRE loans can help you get a commercial property quickly. However, they can be hard to get approval for.

CRE loans generally require that the owner be in business for two years before applying for the loan. They also typically require a 20% down payment (whereas the 504 only requires a 10% down payment).

But if you want to stray from the SBA and consider other options, you can negotiate with lenders to obtain a commercial real estate loan.

4. Inventory Financing

Inventory financing refers to short-term loans and lines of credit used specifically for your inventory. When you first open your front doors, you probably won’t have all the funds to fully stuck your shelves, so inventory financing can come in handy.

This is a good financing option because the inventory itself is used as collateral on the loan, making it less risky for you. Inventory financing can also have lower interest rates than traditional loans.

Combine a strong financing strategy like this one with a streamlined inventory management system, and you’ll be set up for success.

5. Supplier Financing + Wholesale Lending

As an alternative to inventory financing, you can call on your suppliers and wholesalers to fund your prescription drugs, equipment, and OTC items. Different suppliers offer different financing options, so talk to yours and find out what what they can do to help you.

For best results, choose a supplier you’ve worked with in the past, and that you know you can count on. Sometimes suppliers even reward loyal customers with incentivized rates, so it’s worth researching.

Lenders to Consider for Financing

  • Live Oak Bank — The top choice of independent pharmacy owners looking to open new locations, Live Oak Bank specialized in SBA loans, long-term loans, and commercial real estate (CRE) loans. Sincere 2010, Live Oak Bank has lent over $1B to more than 600 pharmacies nationwide.

  • Ameris BankAmeris Bank is an SBA-preferred lender specializing in 7(a) and 504 term loans. These loans can be used for real estate, debt refinancing, and or working capital in your pharmacy.

  • Bankers Healthcare GroupBankers Healthcare Group offers an online banking option for pharmacy owners, with loans ranging from $20,000-$500,000. The virtual platform can give you added flexibility and make financing easy.

  • MedTrust Capital Group — An online lender specializing in healthcare, MedTrust Capital Group offers working capital loans, CRE loans, refinancing loans, and acquisition loans. This can be a quick, convenient, and easily accessible option for your pharmacy.


Opening a pharmacy is a big investment, but with the right financing options, it’s worth it. As you start shopping around, consider what you need to get your business up and running, then reach out to trusted lenders to see what options they offer. Don’t be afraid to ask around to get the best deal. Your bank account will thank you later.

To learn more about pharmacy financing and all the other essentials needed to get a pharmacy up and running, visit our page, Open a Pharmacy.