Scoop on CVS Pharmacies Shutting Down Some Locations
CVS to Shut Down Pharmacies Located Inside Certain Target Retail Outlets
Hey there! Let's talk about CVS Pharmacy's recent announcement to close some of their pharmacies—but not just any pharmacies, these are the ones tucked inside Target stores. The closures start in February and will wrap up by end of April, according to a spokesperson for CVSHealth.
The decision is part of CVS' goal to realign their national retail footprint and decrease store and pharmacy density. The employees affected by this closure will be offered equivalent positions within the organization.
However, CVS is keeping tight-lipped about the exact locations that will be shutting down. They also operate around 1,800 locations inside Target stores, and prescriptions from the closing pharmacies will be transferred to nearby CVS Pharmacies.
The CVS pharmacies inside Target stores are the result of a partnership struck in 2015, valued at $1.9 billion. With CVS handling the pharmacy operations, Target could focus on expanding its overall wellness business, according to a blog post by the CEO, Brian Cornell at that time.
Now, you might be wondering, why the sudden closure? Well, Amy Thibault, a CVS spokesperson, stated in an email that the closures are based on their evaluation of changes in population, consumer buying patterns, and future health needs to ensure they maintain the optimal pharmacy format in the right locations for customers.
Target, aside from its partnership with CVS, also has creative and store-in-store collaborations with popular brands like Apple, Disney, and Starbucks. The CVS pharmacies inside Target locations operate under a perpetual operating agreement, generating annual occupancy income for the retail giant.
As for Target itself, it reported a total revenue of $25.4 billion in Q3, but the same-store sales for the quarter dropped nearly 5%. The company has approximately 1,950 stores in the U.S. When asked about the CVS pharmacy closures, Target directed inquiries to CVS. It also declined to comment on whether they would replace the soon-to-be-closed CVS locations with another in-store pharmacy partner.
In the retail sector, health services and products have been a Growing concern. Walmart plans to expand its health clinics to over 75 locations this year, and Best Buy acquired emergency response provider GreatCall for $800 million back in 2018, later entering multiple partnerships with major health systems.
It's worth noting that CVS has experienced layoffs before. In August 2021, they announced that they would let go of 5,000 employees as part of broader expense reduction measures, primarily affecting corporate roles.
Lastly, for the third quarter of 2021, CVS reported a revenue of $89.8 billion, a 10.6% increase from the previous year, with $3.7 billion in operating income compared to a $3.9 billion loss the year prior. CVS operates more than 9,000 pharmacies, including those within Target and Schnucks grocery stores, a Midwestern chain.
- The closure of some CVS Pharmacies, specifically those within Target stores, has been confirmed and will start in February, according to CVSHealth.
- These decisions are part of CVS' goal to realign their national retail footprint and decrease store and pharmacy density.
- Employees affected by this closure will be offered equivalent positions within the organization.
- The health-and-wellness industry is a growing concern in the retail sector, with Walmart planning to expand its health clinics and Best Buy acquiring emergency response provider GreatCall.
- CVS operates over 9,000 pharmacies, including those within Target and Schnucks grocery stores, and handles the pharmacy operations for around 1,800 locations inside Target stores.
- Science and consumer buying patterns play a significant role in CVS' decisions to ensure they maintain the optimal pharmacy format in the right locations.
- In addition to operating as a pharmacy, Target also collaborates with popular brands in creative and store-in-store collaborations. The CVS pharmacies inside Target locations operate under a perpetual operating agreement, generating annual occupancy income for the retail giant.
