Shoppers may need to look for new pharmacy options as Walgreens plans to close up to a quarter of its 8,600 U.S. stores.
By 2027, Walgreens Plans To Close Thousands More Stores
In an interview with the Wall Street Journal on June 27, Walgreens CEO Tim Wentworth revealed that the closures will target unprofitable locations, stores situated too closely to each other, and those struggling with theft. This move aligns with the growing trend of customers preferring to fill prescriptions online rather than in person. Wentworth stated, “The current pharmacy model is not sustainable,” according to a CNN report. Other chains, like CVS (closing pharmacies in select Target stores) and Rite Aid, are also facing similar challenges due to lower reimbursement rates for prescription drugs.
Consumers are increasingly turning to digital giants like Walmart and Amazon for shopping, bypassing traditional in-store purchases. Wentworth noted, “Our customers have become increasingly selective and price sensitive in their purchases,” as reported by the Associated Press.
While the number of store closures was not specified, Walgreens representatives have indicated plans for “significant” closures of underperforming stores nationwide. This number could increase if store performance does not improve.
CNN reports that 75% of Walgreens’ U.S. stores generate all of its operating income, prompting the company to review the remaining 25% for potential closure. This translates to about 2,150 stores potentially shutting down over the next three years.
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Wentworth confirmed the closures of numerous underperforming stores but mentioned the possibility of making some locations profitable. Additionally, employees at affected stores will be offered positions elsewhere to minimize job losses.
Correction (7/8/2024): An earlier version of this story incorrectly listed store closures by state. A Walgreens representative clarified that an official list has not been released. The representative stated, “Approximately 25% of Walgreens stores are not contributing to our long-term strategy. We’re wrapping up an optimization effort that we anticipate will result in the closure of a sizable number of these locations during the following three years. In addition, we are investing in and implementing some initiatives to improve the experience for patients and customers.