WSJ: Rite Aid plans 400-500 store closures in pending bankruptcy filing

[storewanderer]

Rite Aid sold the Payless name to some independent mail order pharmacy in Oregon. It appears they have merged a couple times. https://www.linkedin.com/company/payles ... c-pharmacy
So I don't think they or any buyer of stores could immediately use that name.

Thrifty name is pretty connected to the ice cream and I expect that name to basically be sold with the ice cream and also not available to be put onto stores (unless whoever buys the ice cream is the same group who buys the stores).

Based on these creditors/bondholders it is probably all a moot point anyway.

At least in California, both the trade names "Thrifty" and "Payless" are used as "Thrifty Payless, Inc.". Their California pharmacy licenses at some locations is also filed as "Thrifty Payless, Inc." This way, at least in California, RAD has kept the use of the "Thrifty" and "Payless" trademark and brand names in use - and from being taken by another entity.

Someone could make an argument/case that "Thrifty Payless" trademark is not in "active" use. What saves RAD from losing the "Thrifty Payless" trade name is that certain pharmacies in California, the license is posted and displayed as "Thrifty Payless, Inc". As long as the trademark/brand name is actively being used/displayed - it belongs to RAD. No matter how small the print, as long as the "Thrifty Payless" name is displayed - in this case on their PharmD licenses that are on display, RAD keeps use of the "Thrifty Payless" name and case closed. For legal purposes, it could even be used on one shopping cart or a display, hence the "Thrifty" trademark used for ice cream. FedEx keeps their "Kinko's" trade name alive by slapping the "Kinko's" logo and brand name on every self-service copy machine located within their FedEx Office locations.

RAD has spread the locations using the "Thrifty Payless" trade name throughout the state, from San Diego to Eureka to Susanville and even little Palo Cedro.

Union bargaining agreements have also kept the "Thrifty Payless" name in use.

As far as my suggestion to keep "Thrifty", "Thrifty Drugs" and "Thrifty Ice Cream" and not use "Payless" still stands. I am certain that as much as I and others would like, "Thrifty" will not be coming back as a name of a drug/general merchandise store - but if the ever small chance the west coast stores remain, then use Thrifty Drugs.

Tell me again why RAD spent money to move from cheap rent Camp Hill to Philadelphia? Why Philly? It has the worst airport terminal of any big airline hub, the second worst is Charlotte - both American! I still think it's funny that in the RAD press release, RAD puffed it's chest about "collaborating" between Bartell Drugs, Elixir and Thrifty Ice Cream...lol

Current share price: Just a tad over a .40c a share, or a value of $21.6 million based on outstanding shares.

SO_CAL_RETAIL_SLUT

Legally they are "Thrifty Payless" out west for licensing purposes (maybe even employee payroll in some cases) but the trade name for retail pharmacy "Payless Drug" was sold to that other party. At the time it was sold, the stores had a lot of signs, carts, etc. that still said Payless and they were given orders to paint over/cover up anything that said Payless. But those orders were not followed 100% specifically on Halloween when some long term Rite Aid employees may pull out their old gray and pink Payless smocks. Rite Aid no longer has that trade name "Payless Drug." They cannot operate a store or pharmacy with the name "Payless Drug."

Now I wonder if a store or pharmacy could be operated using the name "Thrifty Payless."

The HQ in Philadelphia is tiny, and the new corporate address on private label products is in Etters, PA (whatever that is). They shifted to a fully remote corporate workforce. I am not sure how often the previous CEO was in PA; my understanding is the previous CEO was positioned somewhere around Virginia Beach. Many employees at Camp Hill were there for decades and went through a lot. I am always suspicious of management who come in and relocate headquarters and either displace or cause to move (displacing or in this place "moving to remote") a bunch of loyal long term corporate staff.

[veteran+]

All this about Rite Aid and corporate America, writ large, is a testament about the incompetence of the E-Suite class. Add amoral stakeholders and we have what we have today.

Yet these clowns keep on getting recirculated doing the same thing over and over gain expecting different results.

[pseudo3d]

Several people has said that the west coast stores should go back to the Payless name. That would be a huge mistake. It's been nearly 30 years since Rite Aid purchased Payless. No one under 50 remembers the name. And with the huge popular shift out west, it's even fewer. Might as well start with a new name as the Payless brand has zero cache except for us old people.

Plus I (in my early 30s, not West Coast based) associate "Payless" with Payless ShoeSource.

[SO_CAL_RETAIL_SLUT]

Rite Aid sold the Payless name to some independent mail order pharmacy in Oregon. It appears they have merged a couple times. https://www.linkedin.com/company/payles ... c-pharmacy
So I don't think they or any buyer of stores could immediately use that name.

Thrifty name is pretty connected to the ice cream and I expect that name to basically be sold with the ice cream and also not available to be put onto stores (unless whoever buys the ice cream is the same group who buys the stores).

Based on these creditors/bondholders it is probably all a moot point anyway.

At least in California, both the trade names "Thrifty" and "Payless" are used as "Thrifty Payless, Inc.". Their California pharmacy licenses at some locations is also filed as "Thrifty Payless, Inc." This way, at least in California, RAD has kept the use of the "Thrifty" and "Payless" trademark and brand names in use - and from being taken by another entity.

Someone could make an argument/case that "Thrifty Payless" trademark is not in "active" use. What saves RAD from losing the "Thrifty Payless" trade name is that certain pharmacies in California, the license is posted and displayed as "Thrifty Payless, Inc". As long as the trademark/brand name is actively being used/displayed - it belongs to RAD. No matter how small the print, as long as the "Thrifty Payless" name is displayed - in this case on their PharmD licenses that are on display, RAD keeps use of the "Thrifty Payless" name and case closed. For legal purposes, it could even be used on one shopping cart or a display, hence the "Thrifty" trademark used for ice cream. FedEx keeps their "Kinko's" trade name alive by slapping the "Kinko's" logo and brand name on every self-service copy machine located within their FedEx Office locations.

RAD has spread the locations using the "Thrifty Payless" trade name throughout the state, from San Diego to Eureka to Susanville and even little Palo Cedro.

Union bargaining agreements have also kept the "Thrifty Payless" name in use.

As far as my suggestion to keep "Thrifty", "Thrifty Drugs" and "Thrifty Ice Cream" and not use "Payless" still stands. I am certain that as much as I and others would like, "Thrifty" will not be coming back as a name of a drug/general merchandise store - but if the ever small chance the west coast stores remain, then use Thrifty Drugs.

Tell me again why RAD spent money to move from cheap rent Camp Hill to Philadelphia? Why Philly? It has the worst airport terminal of any big airline hub, the second worst is Charlotte - both American! I still think it's funny that in the RAD press release, RAD puffed it's chest about "collaborating" between Bartell Drugs, Elixir and Thrifty Ice Cream...lol

Current share price: Just a tad over a .40c a share, or a value of $21.6 million based on outstanding shares.

SO_CAL_RETAIL_SLUT

Legally they are "Thrifty Payless" out west for licensing purposes (maybe even employee payroll in some cases) but the trade name for retail pharmacy "Payless Drug" was sold to that other party. At the time it was sold, the stores had a lot of signs, carts, etc. that still said Payless and they were given orders to paint over/cover up anything that said Payless. But those orders were not followed 100% specifically on Halloween when some long term Rite Aid employees may pull out their old gray and pink Payless smocks. Rite Aid no longer has that trade name "Payless Drug." They cannot operate a store or pharmacy with the name "Payless Drug."

Now I wonder if a store or pharmacy could be operated using the name "Thrifty Payless."

The HQ in Philadelphia is tiny, and the new corporate address on private label products is in Etters, PA (whatever that is). They shifted to a fully remote corporate workforce. I am not sure how often the previous CEO was in PA; my understanding is the previous CEO was positioned somewhere around Virginia Beach. Many employees at Camp Hill were there for decades and went through a lot. I am always suspicious of management who come in and relocate headquarters and either displace or cause to move (displacing or in this place "moving to remote") a bunch of loyal long term corporate staff.

Hi Mike,

In California, the trade name "Thrifty Payless" is registered for use with the Secretary of State. I haven't checked other states. As you stated, there are a handful of pharmacies licensed as "Thrifty Payless, Inc.". Since RAD has continuously used the Thrifty Payless trade name since acquisition - they have not been subject to the trade name being "lost" to another company or poacher - unlike the ABS/Lucky trade name debacle with Grocery Outlet.

I agree with that the Navy Yard space in PHL is small. Why headquarter in PHL? Not favorable to business, and a horrible airport hub and terminal. The ghost of USAir lives on. It appears in Etters they have about 50,000 sq. ft. box for back office and other corporate related functions.

SO_CAL_RETAIL_SLUT

[storewanderer]

The entire west coast operation is legally "Thrifty Payless" from a licensing perspective. It is just that Payless name that they sold.

However a quick visit to the trademark database seems to reveal that the OR group who bought the Payless name has let those trademarks die. Someone tried to trademark "Thrifty Payless Drugs", an individual from Sherman Oaks, but that was in 2011 and that was allowed to die in 2012.

I have thought of another potential transaction that I think may be good. I am wondering if now that Save Mart did not get chosen for any Kroger/Albertsons store divests if that investment group may have an interest in a block of west coast Rite Aid units and perhaps one distribution center at a fire sale price. Despite exiting the pharmacy business at Save Mart (a move that I suspect helped them not get chosen for any Kroger/Albertsons store divests), I am curious if it may be different for them if they were able to buy actual drug stores. From what I can tell Bob Miller is still in an oversight position on Save Mart's board. I suspect Save Mart has some kind of a non-compete agreement with Walgreens so if the investment group who controls Save Mart would go this route they'd have to run these Rite Aids as a separate division from Save Mart, similar to how World Market is completely separate from Save Mart.

I don't see a benefit to a rebrand on the west coast. I don't feel like Rite Aid necessarily has a bad reputation among customers on the west coast. I think the wellness remodels went a long ways in improving customer perception of Rite Aid as a chain.

[babs]

Several people has said that the west coast stores should go back to the Payless name. That would be a huge mistake. It's been nearly 30 years since Rite Aid purchased Payless. No one under 50 remembers the name. And with the huge popular shift out west, it's even fewer. Might as well start with a new name as the Payless brand has zero cache except for us old people.

Plus I (in my early 30s, not West Coast based) associate "Payless" with Payless ShoeSource.

I don't know the legal issues involved but the week the Payless Drug stores were renamed Rite Aid, the Volume Shoe Source stores became Payless Shoe Source. They were using the Volume brand on the west coast. Clearly, the Payless name was off limits to them in the west until it was no longer being used by another retailer.

[BillyGr]

I agree with that the Navy Yard space in PHL is small. Why headquarter in PHL? Not favorable to business, and a horrible airport hub and terminal. The ghost of USAir lives on. It appears in Etters they have about 50,000 sq. ft. box for back office and other corporate related functions.

SO_CAL_RETAIL_SLUT

They were always headquartered in Pennsylvania, and Philadelphia is a pretty well-known city there, so why not?

They didn't want to move it to some other area/state, apparently.

[SO_CAL_RETAIL_SLUT]

Dollar General should just get into the Pharmacy business and take them all out . Imagine having the prices and variety of a Dollar General with a pharmacy counter!

Actually, from my understanding, DG has been looking at offering some kind of pharmacy service(s) - whether it may be a referral program, mail-order only or actual brick and mortar pharmacy counters inside select DG locations.

The hang-up furthering a study/trial of an in-house pharmacy program is the recent rapid shift in very reduced payments/reimbursements received by pharmacies for products sold. They are not going into a full scale pharmacy program if it will already be underwater and losing money. DG though could certainly fill a "hole" in small rural towns in some towns where a pharmacy desert already exists.

One of the other big hurdles? Finding qualified, licensed pharmacists that want to live in small town America. Will the volumes from these small town stores warrant the expense of payroll, regulatory, security requirements of pharmaceuticals, etc.?

Ironically, this was tried once already by ShopKo when they acquired Pamida, and placed several pharmacies inside re-branded Shopko Hometown Stores. Of course, we all know what happened to Shopko...busted and bankrupt.

SO_CAL_RETAIL_SLUT

[veteran+]

I would not trust DG with a prescription for a pet roach.

[ClownLoach]

The entire west coast operation is legally "Thrifty Payless" from a licensing perspective. It is just that Payless name that they sold.

However a quick visit to the trademark database seems to reveal that the OR group who bought the Payless name has let those trademarks die. Someone tried to trademark "Thrifty Payless Drugs", an individual from Sherman Oaks, but that was in 2011 and that was allowed to die in 2012.

I have thought of another potential transaction that I think may be good. I am wondering if now that Save Mart did not get chosen for any Kroger/Albertsons store divests if that investment group may have an interest in a block of west coast Rite Aid units and perhaps one distribution center at a fire sale price. Despite exiting the pharmacy business at Save Mart (a move that I suspect helped them not get chosen for any Kroger/Albertsons store divests), I am curious if it may be different for them if they were able to buy actual drug stores. From what I can tell Bob Miller is still in an oversight position on Save Mart's board. I suspect Save Mart has some kind of a non-compete agreement with Walgreens so if the investment group who controls Save Mart would go this route they'd have to run these Rite Aids as a separate division from Save Mart, similar to how World Market is completely separate from Save Mart.

I don't see a benefit to a rebrand on the west coast. I don't feel like Rite Aid necessarily has a bad reputation among customers on the west coast. I think the wellness remodels went a long ways in improving customer perception of Rite Aid as a chain.

Makes a lot of sense. Does anyone have a good comparison of West Coast store count vs East Coast? Maybe that would explain the supposed threat of closing hundreds of additional stores when it seems like they're already exiting there on a 3 to 1 basis vs West Coast.

To me, the behavior of Rite Aid, stringing out what seems like a filing that should happen sooner than later, their pseudo PR effort etc. indicate they're trying to work a deal for someone to acquire a good chunk of the company as a going concern. They must be interested in trying to save the company instead of letting it be liquidated.

Save Mart would probably be a good acquirer of a slimmed down West Coast only chain (or chains if you assume they'd leave Bartell alone). I'm still wondering if Amazon goes and makes a play to acquire the entire Bartell segment as a low cost learning experiment into the drugstore and retail pharmacy business, since they seem to be having slightly more success growing their pharmacy front versus their grocery operations these days. Low risk, high potential reward. Somehow, despite their crappy track record I could see them doing well with Bartell. They would probably have minimal changes other than making customer service desk an Amazon return and pickup counter, add some lockers, and probably make Prime a loyalty program. Behind the scenes whatever deal making they're up to with insurance companies could apply to fixing the financial side of the pharmacy. They could merge the PBM into Amazon pharmacy as well. It's better than seeing it liquidated.