One small step for Domestic, One giant leap for International

Just got back from Puerto Rico (PR) this last week and I noticed the number of American companies, subsidiaries, and chains that have moved into this small sized island. Puerto Rico has some advantages but what makes it more attractive is the low risk to implement and setup a business in a country that is considered part of the U.S. For small to mid-size businesses that do not have any international experience but want to go abroad for the first time, then PR is for you. I have worked for one of the largest retailers in Logistics and Distribution in the United States and their key sales was in selling pharmaceuticals. FYI...Each Prescription (Rx) unit priced at an average of $200 but because of healthcare U.S. citizens tend to only pay a small fraction of this.

The advantage of the pharmaceutical companies in the United States is that there are high regulations and standards to producing prescriptions and preventing counterfeits as well as strong enforcement of both. In many other countries around the world this is not the case, which is a high risk for the retail I worked for provided they wanted to move to any other country. Going north you have Canada who offered prescriptions at a lower price because the process to develop them is much easier and less regulated than in the U.S. Going south you have Mexico, very attractive in numbers but the risk goes through the roof since competition is brutal, counterfeits are not being enforced, and competition most likely has more effective drugs that are illegal in the U.S.

The price of prescriptions is high in the U.S. mostly due to the following: money is placed into research, marketing, labor, development of newer and more effective drugs and finally, recently developed drugs are patented and not available generically for a few years. So the 'Retail Giant' saw the potential and headed to PR to setup a distribution center and stores across the island. As a result, within a few years, the front-end and back-end sales were high and many of stores were making 2-3 times more than any store in the U.S.