CVS just announced its decision to close over 900 of its stores over the next three years, citing “changing consumer buying patterns.”
During the pandemic, patients and consumers engaged with online health services, including telehealth companies, curbside pickup, and online prescription refills. That’s why CVS is pivoting away from being “just another drugstore.” The company is remodeling thousands of stores, adding doctors’ offices and other health services in lieu of more store shelves. The move is part of CVS’ commitment to health services and digital growth.
The closings will represent about 10% of CVS’ entire brick-and-mortar presence. In the Oct. 14 edition of The Daily Rip, we covered Walgreens’ attempts to mimic CVS’ horizontally-integrated business (pharmacies, health services, e-commerce, and physical retail.) Walgreens’ decision to pivot was well-received by investors.
Is this the era of the all-in-one pharmacy-clinic? 🤔 Retail analyst Neil Saunders commented:
“The retail side of CVS’s business is shabby. Too many stores are stuck in the past with bad lighting, depressing interiors, messy merchandising, and a weak assortment of products. They are not destinations or places where people go out of anything other than necessity.”
Investors responded well to the news. $CVS closed +2.81% today.