Drug Stores & Pharmacies Industry Trends

Chains Buying Independent Store "Files"

Chains eliminate independent drugstores mostly through acquisition by buying the existing independent stores, which often are in small, unfavorable locations, then closing the store and using the patient prescription files (and often hiring the pharmacist).

Freestanding Locations

Chains are moving stores out of strip malls to freestanding stores. CVS has 30 percent of its stores freestanding, but plans to increase this to 80 percent. More than half of Walgreens’ freestanding stores are usually larger (12,000 square feet) and have more high-margin front-store item sales than their other stores. Chain drugstore construction is driven by the discovery that large, freestanding stores perform much better than strip-center stores.

Pharmacist Shortage

Drugstores are competing with hospitals and retail chain stores over the limited supply of pharmacists, despite an increase in the number of pharmacy graduates. Some drugstores are competing for newly graduated pharmacists by offering additional compensation, like stipends to cover student loans and signing bonuses. The lack of experienced pharmacists increases the likelihood of errors in filling prescriptions.

Internet Pharmacies

Large drugstore chains, such as Walgreens, Eckerd, and Rite Aid, offer convenience by receiving prescription orders over the Internet, so customers don't have to wait at the store while a pharmacist fills their prescriptions.

Drug Company Discount Cards

Some drug companies are offering drug discount cards to the elderly, promising to cut prices on medicines they manufacture. The National Association of Chain Drug Stores (NACDS) believes that discount card plans cost pharmacies and are simply a brand name drug promotion for expensive products.

24-Hour Service

As doctors write more prescriptions and hospitals increasingly trim pharmacy hours, 24-hour drugstores have become a vital link in the healthcare chain. Sunday, when many smaller drugstores are closed, is typically the busiest day for drugstores that are open.

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