Walgreens Close To Buying Rite Aid

SamSpade
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Re: Walgreens Close To Buying Rite Aid

Post by SamSpade » June 29th, 2017, 4:24 pm

Super S wrote:
storewanderer wrote:The only thing happening out west is selling 5 stores in Idaho, selling all stores in Utah (this is not a big loss), and selling most stores in Colorado.


Where in Idaho? I didn't see that in any of the articles. I know they have struggled in the eastern part of the state. They seem to be doing just fine in Boise though.

If it's 5 stores, it's the northern stores closest to the Spokane, Wash. region I would assume.
That leaves them 9 stores, all in the Treasure Valley. Need to build in Nampa though. ;-)

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Re: Walgreens Close To Buying Rite Aid

Post by klkla » June 29th, 2017, 5:08 pm

This should be very good for RiteAid. They need to pay down that debt and focus on operations.

I was in one of their new stores in Glendale, CA two weeks ago and it looked very nice. It was well stocked and well staffed.

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Re: Walgreens Close To Buying Rite Aid

Post by CalItalian » June 29th, 2017, 7:21 pm

klkla wrote:This should be very good for RiteAid. They need to pay down that debt and focus on operations.

I was in one of their new stores in Glendale, CA two weeks ago and it looked very nice. It was well stocked and well staffed.

The Rite Aid in Culver City just finished its second remodel in 3 1/2 years. They were the last to get the remodel prior to the current version which I love. All of the stores in West Los Angeles, except National Blvd. & Sawtelle, have been remodeled. Beverly Hills store on Canon is especially nice.

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Re: Walgreens Close To Buying Rite Aid

Post by CalItalian » June 29th, 2017, 7:24 pm

Coupons in the News is going to have an ongoing update of specific locations that are being sold to Walgreens. Like they did with the Haggen purchases http://couponsinthenews.com/2017/06/29/ ... test-list/

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Re: Walgreens Close To Buying Rite Aid

Post by mbz321 » June 29th, 2017, 8:35 pm

I'm glad to see that PA is (supposedly) safe...there are too many mediocre Walgreens stores around. Makes sense given Rite Aid is based in central PA.

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Re: Walgreens Close To Buying Rite Aid

Post by storewanderer » June 29th, 2017, 9:13 pm

Supposedly 60% of the stores being retained have the "Wellness" remodel.

It is a little weird how they completely gutted certain states back east then keep a lot of stores in other states back there.

It will be interesting to see if the FTC signs off on this or requires some stores to be divested (I assume that will mean just not sold).

I don't see Rite Aid staying in the states where they have 4 or so stores left. Geographically it just does not make sense. Also I think those are some of Rite Aid's worst performing territories (the South) made up of very poorly performing former Eckerds or poorly performing original Rite Aids. Unloading the South onto Walgreens was quite the smooth move in my opinion because that is a network of true dog stores down in those states. Utah is another group of dog stores, many still look like Osco inside and they haven't been Oscos since 1992. Colorado I am a little surprised they will sell so many stores, given Walgreens is already very dominant there, but again, those are mostly former Oscos and not great performers.

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Re: Walgreens Close To Buying Rite Aid

Post by Super S » June 29th, 2017, 9:38 pm

storewanderer wrote:Supposedly 60% of the stores being retained have the "Wellness" remodel.

It is a little weird how they completely gutted certain states back east then keep a lot of stores in other states back there.

It will be interesting to see if the FTC signs off on this or requires some stores to be divested (I assume that will mean just not sold).

I don't see Rite Aid staying in the states where they have 4 or so stores left. Geographically it just does not make sense. Also I think those are some of Rite Aid's worst performing territories (the South) made up of very poorly performing former Eckerds or poorly performing original Rite Aids. Unloading the South onto Walgreens was quite the smooth move in my opinion because that is a network of true dog stores down in those states. Utah is another group of dog stores, many still look like Osco inside and they haven't been Oscos since 1992. Colorado I am a little surprised they will sell so many stores, given Walgreens is already very dominant there, but again, those are mostly former Oscos and not great performers.


Washington and Oregon had some stores that were "dogs" until recently, some which had not been remodeled since the PayLess days, and at least one that still had a Pay 'N Save interior. Rite Aid was smart to invest in these stores especially since CVS has very little presence in the area other than the pharmacies in Target stores.

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Re: Walgreens Close To Buying Rite Aid

Post by storewanderer » June 29th, 2017, 10:41 pm

I'd also like to know how many stores being sold have Wellness interiors. I was in quite a few Rite Aids in GA, SC, and NC on a trip there over a year ago, most were former Eckerds and business was terrible in all but a few cases. I was usually the only customer in the store at any given time. While there was nothing explicitly wrong with the stores (they were clean enough, stocked okay, etc.), there were just no customers. During that I went into 20+ stores and only saw 1 Wellness Store (which so happened to be a 24 hour store somewhere around Charleston that seemed to do okay business).

Similar situation in the Utah Rite Aids around Salt Lake City and Ogden (and the real dog store down in St. George).

Walgreens could have absolutely bought some stores in OR, WA, and CA. But they didn't. Either they didn't want them (doubt that...), or Rite Aid did not want to sell those stores and butcher those states in an effort to help keep some areas of strength in the remaining stand alone company.

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Re: Walgreens Close To Buying Rite Aid

Post by buckguy » June 30th, 2017, 6:15 am

The old Eckerd locations were very weak and I'm surprised Rite Aid kept any of them, after previous waves of store closings. Some actually have decent locations. I lived in New England when Brooks was still Brooks--they had an odd collection of locations that were basically neglected and Rite Aid's presence has been pretty limited when I have visited. Unless Rite Aid has done something radical in the past few years, it probably makes sense to unload these. The states with a handful of stores probably have them in border areas--S or SW Georgia, Mississippi suburbs of Memphis, peripheral areas of WV (which tend to be where population centers are located). I wouldn't get too distracted by those details.

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Re: Walgreens Close To Buying Rite Aid

Post by wnetmacman » June 30th, 2017, 6:47 am

Interesting that they're only keeping 4 of the 52 stores in Louisiana. All of these stores (or their immediate predecessors) were purchased 20 years ago from K&B out of New Orleans. K&B had over 100 locations when they were bought out, and Rite Aid slowly killed them off one by one. Many of these stores were the old locations, with the purple-tinted paneling and purple trim, along with the terazzo flooring. When Rite Aid took them over, New Orleans treated it like the end of life.

There is still a term for one aspect of K&B even 20 years later: K&B Purple. At the outset, when K&B was still Katz & Besthoff, they got a shipment of purple paper cheap to wrap items in for delivery. It caught on, so they kept it. All the stores and even their logo were colored with it, and it stuck.

In some aspects, I'm sad to see them go, but in others, they badly tarnished the reputation that K&B had built. I live in Lafayette; when I moved here in 2000, there were 6 Rite Aid stores and 2 Walgreens. Now, there are 9 Walgreens, and the 2 remaining Rite Aid stores may soon become Walgreens, as both are just out of the way from a competing Walgreens store. One closed about 6 months ago across the street from a popular Walgreens. I kind of figured out the strategy then.

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