Sheila Tucker worked as a pharmacist for more than 20 years in several chain pharmacies, hospitals, nursing homes and as a consultant, and while she liked her job, she wanted her own business.
“I always knew I wanted to have my own pharmacy,” Tucker said. “I just didn’t have a clue as to how I was going to do it.”
Tucker found help at the Small Business Development Center in Wilmington and funding through the U.S. Small Business Administration (SBA) to make her vision of owning a pharmacy reality.
In 2003, a store-front location at 1914 North Market Street in the Brandywine Village became available for rent and the building owner approached Tucker about opening a business. The owner even offered her six months free rent as an incentive to get Market Street Pharmacy up and running.
Tucker contacted the Greater Brandywine Village Revitalization staff, who happened to be looking for an entrepreneur to open the first independent pharmacy in the area and they helped her identify resources to help get the business operating.
A graduate of Virginia Commonwealth University and Temple University School of Pharmacy, Tucker approached John Simpson, a colleague with whom she had worked in a pharmacy previously, to be a co-owner.
“‘You want to jump in?’ I asked him,” Tucker said. “I was leery myself and then all the doubts came.”
Opening an independent pharmacy daunted Tucker. Only a handful of independent pharmacies operate in New Castle County and often they do not provide the full range of services and products of large chain pharmacies.
The fears subsided with guidance from counselors at the Small Business Development Center, an SBA resource partner, who helped Tucker analyze the area’s demographic data, build financial models for the new store, develop a loan package, and choose business service vendors. According to John Osoinach, director of the New Castle County SBDC office, “The SBDC was able to step in and provide just the right help at just the right time, and that was a key to making the project a success.”
Tucker and Simpson, both first-time business entrepreneurs, initially funded the business with personal money; the pharmacy’s floors needed to be cleaned and shelves installed. With their personal money running low, the owners still needed funding to buy the inventory to stock those new shelves.
Initially, three banks rejected Tucker and Simpson for loans, but the SBA’s loan guarantee programs allowed Tucker and Simpson to secure the required funding. The Market Street Pharmacy opened in September 2003 and in December two SBA-backed 7(a) loans were approved through Wilmington Trust totaling almost $200,000.
George Mills of Wilmington Trust worked with the pharmacy owners to acquire the loan. He knew owners had the practical experience to operate a pharmacy but had to consider the added responsibility of managing the business, ordering supplies, marketing and supervising employees when approving the loan.
“With the help of the SBDC working with the owners to put together a business plan and the SBA's guarantee of the loan Wilmington Trust was able to approve the loan overcoming all the perceived risks associated with lending to a start-up business,” Mills said.
The SBA’s 7(a) Loan Guaranty Program operates through private-sector banks that provide small business loans guaranteed by the SBA. Providing this guaranty, the SBA helps many small businesses like Market Street Pharmacy obtain financing to start, build and grow their operations.
The pharmacy’s growth is already evident. Sales in 2006 totaled $1.1 million, up from almost $900,000 in 2005. The Market Street Pharmacy operates six days a week and fills 100 prescriptions a day, but Tucker’s expects to fill 350 per day soon with expanded service to most insurance plans.
In April 2007, Tucker and Simpson opened a second location at 1624 Jessup Street in Wilmington. Word is spreading about the new pharmacy, which fills 10 to 12 prescriptions a day and continues to grow. The stores provide prescription drugs, over-the-counter medicine and convenience store items in the low-income and disadvantaged neighborhood and employ seven employees, four of whom are full time.
Both pharmacies provide an essential service and operate in underserved neighborhoods where most of the clients earn too much income to be covered by Medicaid, but not enough to afford health insurance. Market Street Pharmacy can more easily serve these communities as a member of the federal 340B Drug Pricing Program, which provides access to reduced price prescription.
A common vision and hard work helped Tucker and Simpson launch the business while managing their personal lives, spouses and children and the business.
“This is a lot of work, but we see eye-to-eye,” Tucker said. “We have the same vision. We have lots of plans.”
The co-owners plan to operate five stores, the third of which is already in the development stages.
Tucker suggests finding a niche within the industry, which for the pharmacy business means a privately-owned operation and allows her to use her discretion to give discounts and provide special arrangements for regular customers.
Tucker’s advice for anyone considering opening a business: “Go for it. It can be rewarding.”
One of the best compliments a client can give Appletree Answering Service’s owner and founder John Ratliff is that the consumer public does not know the company exists. Appletree, a telemessaging company using live agents who answer calls with a customized greeting, strives to tailor technology to meet the needs of individual clients, allowing Appletree to become a true client extension, not just an answering service.
Since its founding in 1995, the Wilmington-based company has grown to 300 employees and earned $7.5 million in revenue in 2006. Projections call for the company to hit $13 million in 2007. Appletree began as a one-man operation in Ratliff’s apartment and now operates in 12 locations. That growth has come about in part through a loan guaranteed by the U.S. Small Business Administration and counseling from SCORE—Counselors to Americas Small Business—and the Small Business Development Center.
One of Appletree’s keys to success is its heavy investment in technology—over $2 million—in an industry still dominated by low-tech or no-tech mom-and-pop firms. Appletree’s interactive computer system allows each client to customize its calls. Effective employee training, high levels of customer service and quality set Appletree apart from competition. A heavy investment in its management structure gives employees the opportunity for advancement if they become proficient with customer service and technical components.
Investments in technology and human capital fostered Appletree’s growth and led to recognition for both its growth and service quality. In 2004, Appletree earned the national award for service excellence from the Association of TeleServices Industries and in 2006, each of Appletree offices won ATSI’s Award of Excellence. Inc 500 named the company one of America’s fastest growing private companies for 2004-2006. Philly 100 also recognized Appletree as one of the Philadelphia region’s 100 fastest growing companies in 2004, 2005 and 2006. Most recently, Ratliff, nominated by WSFS Bank, was named the 2007 Entrepreneur of the Year by the New Castle County Chamber of Commerce.
Founder John Ratliff, a native of Chadds Ford, Pa., graduated from the University of Delaware with degrees in finance and marketing in 1992. He briefly worked as an agent for Metrophone before opening a cellular phone agency in May 1993 and a second location in 1994.
In the first few years, Ratliff said he operated Appletree 24 hours a day, seven days a week, sometimes going six or seven weeks without leaving his apartment. He paid family and friends peanuts to work two or three hours at a time so he could get some sleep.
“Sleep was secondary,” Ratliff said. “I would try and sleep between calls during the overnight shift, but the more we grew the harder that became.”
However, he was determined to make Appletree work. By the end of the first year, the company generated $135,000 in revenue. By the end of the second year, Appletree had 10 employees.
Appletree steadily built its client base by focusing on the goal of exceeding the client’s expectations in value, either in saved labor costs or increased revenue. Clients mostly included small business service providers, such as property management firms, electricians, plumbing and heating companies or medical service providers.
The firm generated $414,000 in revenue by 1999. Although the firm grew, Ratliff was maxing out credit cards and still personally handling a large number of calls. Ratliff got the financial assistance he needed when Citizens Bank made an SBA guaranteed 7(a) loan for a $50,000 line of credit. Using the loan, Appletree added a state of the art telecom system and YellowPage Advertising.
“That line of credit was the critical link in keeping us afloat during a period of rapid growth,” Ratliff said.
The 7(a) program through which Appletree obtained its line of credit is SBA's primary lending program. It targets small businesses unable to secure financing on reasonable terms through conventional lending channels. The program operates through private-sector lenders who provide loans that are, in turn, guaranteed by the SBA. The maximum loan amount is typically $2 million, however, the maximum dollar amount of the SBA guaranty is generally $1.5 million.
Appletree has since acquired 11 companies and today boasts locations in eight states and Puerto Rico, as well as its headquarters in Delaware. Appletree has maintained at least 30 percent growth in revenue for each of the past eight years. Compliments aside, its clients can’t help but notice Appletree’s presence at this rapid growth rate.