CVS operating Schnucks (Grocer) Pharmacies

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pseudo3d
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Re: CVS operating Schnucks (Grocer) Pharmacies

Post by pseudo3d » March 12th, 2020, 10:32 pm

klkla wrote:
March 12th, 2020, 2:55 pm
I don't think it was an experiment. Many of the divested stores they bought when Albertson's and Lucky merged had pharmacies. That was the reason for going into the pharmacy business.
That makes it even more of an outlier, and why it was in so few stores.
Alpha8472 wrote:
March 12th, 2020, 6:35 am
CVS will only open a pharmacy in a store that does not sell tobacco. This means that most supermarket chains are off limits to CVS.

Many store chains will not be willing to give up tobacco just to have CVS take over their failing pharmacy operations.

When Elephant Pharmacy was failing, they lost their contract to secure brand name drugs. This made it so that people could not get their urgent brand name only drugs such as essential HIV medications to keep patients alive. Patients ended up transferring their prescriptions to other pharmacies which led to the closure of the entire chain. If you cannot keep medications in stock, your business is dead. Failing pharmacy operations is the first symptom of a business that could go out of business.

With so few pharmacies Schnucks was probably not able to secure decent prices on drugs. CVS with its buying power can get drugs at lower prices and keep profitability.
You bring up a good point—announcing the end of tobacco sales last year with tobacco-free CVS coming in to take their pharmacies off their hands suggests that was the plan all along. However, Schnucks' pharmacy operation wasn't particularly small, with about 100 in the chain, approaching a 1:1 ratio of pharmacies to retail stores, which is more what you can say for most chains (hovering around 80-85% at best), and 100 pharmacies is more than Raley's ever had (well, before their most recent pharmacy closure anyway).

I know that reiterating that getting out of the pharmacy business indicates bad news is beating a dead horse at this point, but the other thing that's interesting to note is the company is doing it chain-wide. If the outlier stores were a drag (Hilander and Logli conversions, or anywhere in northwest Illinois, where Jewel-Osco spreads out to) then it would be wise to ditch those first, under the guise of "strategic markets" or something along those lines.

storewanderer
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Re: CVS operating Schnucks (Grocer) Pharmacies

Post by storewanderer » March 12th, 2020, 11:14 pm

Well for CVS they have to take good pharmacies in densely populated metro areas and along with that they take the not so good ones out in the rural areas.

Raleys discontinued tobacco sales long ago. Probably a big reason why their gas station enterprise did not pan out so well for them. I am not sure if those sell cigarettes yet or if they still don't sell them even under new ownership.

I am also curious where it was disclosed CVS would not be a tenant pharmacy in a place that also has tobacco. That is a little weird. If they are not the one selling the tobacco, what does it matter? They operate the little box called the pharmacy, they don't control the whole store or what it does. They are like a bank in a supermarket. The bank doesn't tell the supermarket what it can and cannot sell.

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Re: CVS operating Schnucks (Grocer) Pharmacies

Post by Alpha8472 » March 13th, 2020, 6:01 pm

CVS Health announced years ago that all CVS Pharmacies would not sell tobacco products. CVS also announced that stores that sell tobacco will have higher copays for CVS insurance. So in order to get the cheaper copays, the stores must be tobacco free. It is all about the money.

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Re: CVS operating Schnucks (Grocer) Pharmacies

Post by retailfanmitchell019 » March 13th, 2020, 9:59 pm

pseudo3d wrote:
March 12th, 2020, 10:32 pm
klkla wrote:
March 12th, 2020, 2:55 pm
I don't think it was an experiment. Many of the divested stores they bought when Albertson's and Lucky merged had pharmacies. That was the reason for going into the pharmacy business.
That makes it even more of an outlier, and why it was in so few stores.

I know that reiterating that getting out of the pharmacy business indicates bad news is beating a dead horse at this point, but the other thing that's interesting to note is the company is doing it chain-wide. If the outlier stores were a drag (Hilander and Logli conversions, or anywhere in northwest Illinois, where Jewel-Osco spreads out to) then it would be wise to ditch those first, under the guise of "strategic markets" or something along those lines.
Schnucks competes with Jewel in DeKalb (60 miles west of Chicago, but 40 miles SE of Rockford, where Hilander and Logli Stores were located) and Bloomington/Normal, in downstate Illinois. Jewel does not have a presence in Rockford.

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Re: CVS operating Schnucks (Grocer) Pharmacies

Post by storewanderer » March 14th, 2020, 12:43 am

Alpha8472 wrote:
March 13th, 2020, 6:01 pm
CVS Health announced years ago that all CVS Pharmacies would not sell tobacco products. CVS also announced that stores that sell tobacco will have higher copays for CVS insurance. So in order to get the cheaper copays, the stores must be tobacco free. It is all about the money.
Well tobacco use yes/no and sex/age are the only factors that can dictate a health insurance rate based on the ACA so I think there are a lot more insurance plans than just CVS who penalize tobacco users either through higher premiums or higher co-pays.

I just wonder if this tobacco restriction means CVS will not house a pharmacy counter in a business that offers tobacco. I suppose time will tell. I know we won't see CVS selling any tobacco from its pharmacy counter.

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Re: CVS operating Schnucks (Grocer) Pharmacies

Post by Alpha8472 » March 14th, 2020, 12:53 am

CVS Health started the higher copay policy to get stores to stop selling tobacco. Another reason is to try to funnel customers to CVS Pharmacies. A customer realizes that their CVS Caremark plan has lower copays at pharmacies that do not sell tobacco, so they go to the tobacco free pharmacy over Walgreens, Rite Aid, and Walmart which sell tobacco. Getting the same medication would cost the customer more at tobacco selling stores. This includes any part of the store and not just the pharmacy.

CVS is just trying to make more money for itself.

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Re: CVS operating Schnucks (Grocer) Pharmacies

Post by storewanderer » March 14th, 2020, 12:58 am

Alpha8472 wrote:
March 14th, 2020, 12:53 am
CVS Health started the higher copay policy to get stores to stop selling tobacco. Another reason is to try to funnel customers to CVS Pharmacies. A customer realizes that their CVS Caremark plan has lower copays at pharmacies that do not sell tobacco, so they go to the tobacco free pharmacy over Walgreens, Rite Aid, and Walmart which sell tobacco. Getting the same medication would cost the customer more at tobacco selling stores. This includes any part of the store and not just the pharmacy.

CVS is just trying to make more money for itself.
This is interesting. Many I know think they are forced to use CVS under their health plans and have no other choice. It is simply not true. They can't go to Walgreens, but they can go to just about any grocery store pharmacy, or Wal Mart, Costco, etc.

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