CVS said on Thursday that it would close 900 pharmacies over the next three years, a total of around 10% of its total locations. What’s going on with CVS right now? During the outbreak, how many people have gone to pharmacies to stock up on hand sanitizer, cleaning wipes, and toilet tissue? In addition, CVS regularly administers the Covid-19 vaccination shots.
CVS Had All The Advantages, But It Could Not Stop The Spread Of Virus
The CVS store closures should not have surprised anybody. Latest in a long line of declines in the retail pharmacy sectors in America. More and more pharmacies are being forced out of business by the big three drugstore chains: CVS/Walgreens, Walgreens/Rite Aid (RAD), and Walmart.
Drug shop closures may have a detrimental effect on local communities because they leave gaps in availability to pharmaceuticals and other requirements.
As the largest pharmacy store chain in the United States at the time of the announcement, CVS was highlighted as a factor in its decision to close its stores due to demographic changes, consumer shopping patterns, and future health needs. CVS is closing 900 stores for the following reasons.
However, this does not imply that CVS will continue to sell snacks, sweets, and shampoo. Health care is where it is. When CVS completed a $69 billion acquisition of Aetna in 2018, it gained access to a huge customer base of nearly 40 million people, the largest healthcare deal in history.
As a result, CVS believes that the value will increase its income from those customers’ health insurance coverage while reducing its costs.
There are three distinct kinds of retail that CVS has been contemplating, and they revealed on Thursday that its sites would be separated into three. The traditional shops, “HealthHub” stores that provide on-site dieticians, nurse practitioners, and lab services, and “HealthHub” stores that offer primary care services are all examples.
CVS is “really pivoting and pushing towards the healthcare side of the company,” according to Deutsche Bank analyst George Hill. Health care services with a high monetary value and strong profit margins are considerably superior to greeting cards when it comes to making money.
There is a good chance that you may see a CVS on your way to work or while traveling through the suburbs. After that, you may go to the Walgreens just next door for some groceries. Rite Aid is also likely to be within driving distance.
There are too many pharmacies and too much pharmacy capacity in the United States. There is a tremendous incentive for CVS to shut because of this, says Hill. Vaccinations and testing for Covid-19 helped CVS, but the firm suffered since consumers limited their shopping visits and went to the doctor less often as a consequence.
After closing 244 stores between 2018 and 2020, CVS still has more than 9,900 stores. The combined sales of Walmart, Target, Kroger, and Costco are greater than that (COST). Due to previous store losses, CVS said Thursday that it would reduce shop density in specific locations. It’s clear that CVS has too many stores in certain locations that are too close together.
Helen Christiane is an American investigative journalist who is currently the editor-in-chief of the media group. According to a PR firm, she was one of the journalists who is most followed by world leaders on Twitter. She also received the Walter Cronkite Award for Excellence in Journalism in 2011. Her effortless delivery of news with a cheerful and friendly disposition has made her a national favorite and as such, has won several awards. She has previously worked as a reporter for USA Today and The New York Times.