Rite Aid closing at least 63 stores

[storewanderer]

Liquidators are involved in current active closing sales. That started back in February or March. I am not sure if the stores with closures announced this week/last week get liquidators as it sounds like they may be on an accelerated timeline.

Went to another store. This store was also a complete disaster. It was also really dirty inside (didn't notice that issue at the 4 stores the prior). About 1/4 of the sales floor is random stuff filling shelves with no rhyme or reason and no planogram. These are some aisles that used to have the categories that got discontinued.

This store was stocked okay on core drug categories like medicine but everything else was in rough shape. A number of departments had less than 50% product in stock. This store also had the absolute highest Rite Aid shelf pricing I've ever seen, higher than the 4 stores yesterday.

These stores need a serious merchandising reset to get the aisles filled back up or get merchandise consolidated into aisles so the aisles are full and just remove the shelves entirely that they can't fill up and get the beer vendors or soda vendors to build displays in the open space. Worst case get cases of water or ice chests or something to fill up the space.

In my view the condition of merchandising in these stores has completely deteriorated since even just summer of 2023.

[mbz321]

Based on this Reddit post, they are definitely using liquidators and sign walkers in some places.


A comment further down says this in Union City, CA

[storewanderer]

The Rite Aid bankruptcy was supposed to end April 22.

There is now a new filing in the Kroll website of dockets:

This is Docket 2774.

Does this mean the bankruptcy is being extended?

"Upon the Debtors’ Motion for Entry of an Order (I) Extending the Debtors’ Exclusive
Periods to File a Chapter 11 Plan and Solicit Acceptances Thereof Pursuant to Section 1121 of
the Bankruptcy Code and (II) Granting Related Relief (the “Motion”),2 of the above-captioned
debtors and debtors in possession (collectively, the “Debtors”), for entry of an order
(this “Order”) (a) extending the Debtors’ Filing Exclusivity Period by 75 days through and
including April 29, 2024, and the Debtors’ Soliciting Exclusivity Period by 75 days through and
including June 26, 2024,1without prejudice to the Debtors’ right to seek further extensions to the
Exclusivity Periods, and (b) granting related relief, all as more fully set forth in the Motion; and
upon the First Day Declaration; and the Court having jurisdiction to consider the Motion and the
relief requested therein pursuant to 28 U.S.C. §§ 157 and 1334 and the Standing Order of
Reference to the Bankruptcy Court Under Title 11 of the United States District Court for the
District of New Jersey,"

[ClownLoach]

The Rite Aid bankruptcy was supposed to end April 22.

There is now a new filing in the Kroll website of dockets:

This is Docket 2774.

Does this mean the bankruptcy is being extended?

"Upon the Debtors’ Motion for Entry of an Order (I) Extending the Debtors’ Exclusive
Periods to File a Chapter 11 Plan and Solicit Acceptances Thereof Pursuant to Section 1121 of
the Bankruptcy Code and (II) Granting Related Relief (the “Motion”),2 of the above-captioned
debtors and debtors in possession (collectively, the “Debtors”), for entry of an order
(this “Order”) (a) extending the Debtors’ Filing Exclusivity Period by 75 days through and
including April 29, 2024, and the Debtors’ Soliciting Exclusivity Period by 75 days through and
including June 26, 2024,1without prejudice to the Debtors’ right to seek further extensions to the
Exclusivity Periods, and (b) granting related relief, all as more fully set forth in the Motion; and
upon the First Day Declaration; and the Court having jurisdiction to consider the Motion and the
relief requested therein pursuant to 28 U.S.C. §§ 157 and 1334 and the Standing Order of
Reference to the Bankruptcy Court Under Title 11 of the United States District Court for the
District of New Jersey,"

I suspect the DOJ settlement is drawing out the process. They have no sense of urgency.

[storewanderer]

The Rite Aid bankruptcy was supposed to end April 22.

There is now a new filing in the Kroll website of dockets:

This is Docket 2774.

Does this mean the bankruptcy is being extended?

"Upon the Debtors’ Motion for Entry of an Order (I) Extending the Debtors’ Exclusive
Periods to File a Chapter 11 Plan and Solicit Acceptances Thereof Pursuant to Section 1121 of
the Bankruptcy Code and (II) Granting Related Relief (the “Motion”),2 of the above-captioned
debtors and debtors in possession (collectively, the “Debtors”), for entry of an order
(this “Order”) (a) extending the Debtors’ Filing Exclusivity Period by 75 days through and
including April 29, 2024, and the Debtors’ Soliciting Exclusivity Period by 75 days through and
including June 26, 2024,1without prejudice to the Debtors’ right to seek further extensions to the
Exclusivity Periods, and (b) granting related relief, all as more fully set forth in the Motion; and
upon the First Day Declaration; and the Court having jurisdiction to consider the Motion and the
relief requested therein pursuant to 28 U.S.C. §§ 157 and 1334 and the Standing Order of
Reference to the Bankruptcy Court Under Title 11 of the United States District Court for the
District of New Jersey,"

I suspect the DOJ settlement is drawing out the process. They have no sense of urgency.

If the company goes out of business there will be nothing left for DOJ.

The longer they stay in bankruptcy the more difficult it will be to come out of bankruptcy...

Based on how the stores I saw last week look I do not hold out much hope here... I sure hope the stores look better elsewhere than they do around Sacramento/rural NorCal.

[reymann]

Maybe the DOJ's endgame is for Rite Aid to be no more.

[ClownLoach]

Maybe the DOJ's endgame is for Rite Aid to be no more.

Makes me wonder. They didn't wish to honor the bankruptcy law, which means lawsuits stop when the entity becomes bankrupt. It's Federal Law vs Federal Law and Rite Aid itself might not have survived but their creditors would be perfectly happy to take the matter to the US Supreme Court where they would win. Because frankly if they didn't win then the DOJ would have thereby eliminated the entire bankruptcy system, and then what? Debtors prisons? Obviously the laws were written to allow for an entity that has more liabilities than assets to restructure.

So delaying the process to force them to burn their DIP financing as a revenge play wouldn't surprise me. It would also not play well in an election year because the creditors who would be losing a few billion for no good reason would make sure everyone knows the government put XX thousand people out of work and closed 1500+ stores in violation of the law, and Congress/The White House etc did nothing to intervene and nudge the process back to following the law. Which would backfire further as the banks write off the loss and suddenly it becomes the DOJ costing the government money through their revenge plot.

[Romr123]

Just visited Palm Springs RA---what I've got to think is a high-volume store. From the entry, store looks great--fully stocked. As you walk down the diagonal aisle toward the pharmacy, there are some out-of-stocks in various categories but appears more to be specific manufacturers (i.e. impending re-set) rather than widespread empty shelves.

Interesting they are no longer closing the pharmacy (again, high-volume as it absorbed the S. Palm Cyn files) for lunch, though there is a sign saying "no pharmacist consultation from 1:15-1:45--technician consultation available" though there were clearly multiple pharmacists and technicians and the pharmacist did swing by to ask as it was a new script for me.

[storewanderer]

Just visited Palm Springs RA---what I've got to think is a high-volume store. From the entry, store looks great--fully stocked. As you walk down the diagonal aisle toward the pharmacy, there are some out-of-stocks in various categories but appears more to be specific manufacturers (i.e. impending re-set) rather than widespread empty shelves.

Interesting they are no longer closing the pharmacy (again, high-volume as it absorbed the S. Palm Cyn files) for lunch, though there is a sign saying "no pharmacist consultation from 1:15-1:45--technician consultation available" though there were clearly multiple pharmacists and technicians and the pharmacist did swing by to ask as it was a new script for me.

Those out of stocks on specific manufacturers are because those manufacturers aren't sending Rite Aid products...

The only categories I see well stocked are cough/cold/pain medicine. Vitamins is even full of out of stocks. Those are categories they did not discount during store closing sales so they should be full stocked since those are core drugstore categories.

First aid and dental are a disaster, unbelievable amount of out of stocks... they discounted those categories 50% during the store closings, maybe that was a mistake and they needed to do pack up of those categories.

It is really bad in some of their "secondary" categories like toys and office supplies. The aisles are like 20% stocked. I have no idea how they actually sold all those items. They did go 50-75% off those categories in the closing sales.

[storewanderer]

Reading on Reddit that Rite Aid is laying off employees in the stores, it appears the unionized CA Stores are getting hit by this.

Not sure what the union is doing... I guess the same thing it has been for the past 4 years when some locals have been working without a contract... at least they collect dues.

If the unionized Rite Aid employees get laid off or get too few hours in theory can they go get a job at a unionized grocery store chain and at least hold on to their union pension etc. (I assume they'd lose seniority and obviously wage since the grocery stores are a completely different contract/wage scale) despite the grocers being on different union contracts? Or are these employees under the Rite Aid UFCW contract basically screwed if they aren't working for Rite Aid?