Walgreens Boots Alliance plans to close 1,200 stores during the next three years, with 500 closures set for next year, in the face of low drug reimbursement rates and slower consumer spending.
The Deerfield, Illinois-based company on Tuesday said it would shutter roughly 14% of its U.S. locations and redeploy the majority of the workers impacted. “We are in a turnaround,” Tim Wentworth, the drugstore chain’s CEO, told an earnings call.
“The closure of so many stores is emblematic of a company that is in trouble and is trying to course correct,” commented Neil Saunders, managing director of GlobalData. “Walgreens spent years building its business through acquisitions and completely neglected the fundamentals of its stores and its retail operations,” the analyst added.
The thing is that CVS was expanding their area of operation in the early. 2000s and Walgreens had enough of a war chest to just build stores like crazy to try and take the spots CVS would want to use or choke CVS out.
So we ended up with Walgreens everywhere and sometimes a Walgreens across the street from a CVS.
CVS isn’t doing so hot in their retail spaces and closing stores, so Walgreens can relax and close down stores.
Are they franchised?
No, all locations are corporate owned for both corporations.