Retail Watchers

Walgreen's is closing Rite Aid's distribution center in Spartanburg County, South Carolina. Operations will transfer to Walgreen's distribution center in Anderson County, South Carolina.

The distribution center was among three and 1,932 stores Walgreen's acquired from Walgreen's in 2017. It opened in 2016.

Further reading

• "Walgreens to close Spartanburg’s Rite Aid distribution center." Spartanburg Herald-Journal. 2019-07-19.

Knight wrote: ↑July 19th, 2019, 11:35 pm Walgreen's is closing Rite Aid's distribution center in Spartanburg County, South Carolina. Operations will transfer to Walgreen's distribution center in Anderson County, South Carolina.

The distribution center was among three and 1,932 stores Walgreen's acquired from Walgreen's in 2017. It opened in 2016.

Further reading

• "Walgreens to close Spartanburg’s Rite Aid distribution center." Spartanburg Herald-Journal. 2019-07-19.

Seems that makes sense to avoid unneeded duplication in the area. One might also suspect that Walgreens has some extra space in their centers to handle larger numbers of stores, based on their shrinking of the variety of items in the stores over the recent years (those "blank spaces" in aisles filled with display posters rather than actual merchandise, the removal of end caps in many places etc.).

Walgreen's "blank spaces" could be filled from other merchandise rather than display posters.

Knight wrote: ↑August 2nd, 2019, 8:45 am Walgreen's "blank spaces" could be filled from other merchandise rather than display posters.

The objective of the simple stores was to make them... simple. Low stock, lower labor, fewer price changes, no backstock whatsoever. Basically kill the volume in the already low volume stores and operate them with as low of a cost structure as possible. Adding merchandise to those empty spaces takes time and effort of staff to merchandise, order extra product, etc. and goes against the concept Walgreens was going for with those stores.

The biggest issue I see is the stores are simply too many square feet for this to make sense. This is like the Watsons concept over in Asia with little boutique like drugstores that do not push volume but operate solely like a convenience format with limited mix and limited promotion. Maybe that is the type of format Boots uses too. But Boots and Watsons don't operate 15,000 square foot freestanding buildings at busy intersections; they operate little 2,000 square foot stores in heavily foot trafficked areas. There is a big difference and I feel Walgreens really is missing the mark with these "simple stores." They should probably just downsize the stores (chop off the half that has cosmetics - that half also usually has the employee break room and bathroom so that would need to be relocated, but they could keep pharmacy, cooler, photo, management office, loading dock, etc. in current form with that set up), but the way the stores are designed it would not be easy to do that.

I dislike the "simple store" format immensely.

What is also interesting is that while they "shrunk" those stores, in one location here they bought an existing Rite Aid (that began as an Eckerd) and remodeled that store, then closed their own existing Walgreens location.

What makes it more interesting is that this particular Walgreens was a smaller store to begin with (and not that old, but just built smaller). It had aisles without the middle break that most of their stores have and just generally was a bit smaller footprint overall.

While across the river, they also bought the existing Rite Aid (one of their standard freestanding stores of the pre-Wellness model) and then closed that one, keeping the existing more standard Walgreens across the street open (and I think they had done the "simplify" treatment on that one).

So in one spot they are shrinking the store (or at least the variety of items in it) while the other they are closing a store that started out shrunken and remodeling the taken over store (which is larger) instead. Hmm....

BillyGr wrote: ↑August 4th, 2019, 3:53 pm What is also interesting is that while they "shrunk" those stores, in one location here they bought an existing Rite Aid (that began as an Eckerd) and remodeled that store, then closed their own existing Walgreens location.

What makes it more interesting is that this particular Walgreens was a smaller store to begin with (and not that old, but just built smaller). It had aisles without the middle break that most of their stores have and just generally was a bit smaller footprint overall.

While across the river, they also bought the existing Rite Aid (one of their standard freestanding stores of the pre-Wellness model) and then closed that one, keeping the existing more standard Walgreens across the street open (and I think they had done the "simplify" treatment on that one).

So in one spot they are shrinking the store (or at least the variety of items in it) while the other they are closing a store that started out shrunken and remodeling the taken over store (which is larger) instead. Hmm....

I have wondered if Walgreens would de-simplify some of those stores if conditions warranted it. Conditions you describe seem to me like they would warrant it (consolidating a larger Rite Aid into a simple store).

We have a location in Sparks that was simplified. Low volume and not the best neighborhood. Kmart was in the same shopping center, and Family Dollar. So obviously a store that will have low front end sales. Well, Kmart closed. To me that changed conditions; the Walgreens is noticeably busier now (but all 1 and 2 item type purchases) and they have kept it a "simple" store. It is also the only Walgreens I've ever seen that has a section of $1 items. Dire, old Longs now smelly CVS dive across the road that should have been closed long ago. The CVS had a fire system failure over the winter which caused it to close for a while, and they actually had to go in there and clean the place up after the sprinklers malfunctioned and sprayed all over, and the store looked a lot better after it reopened, but it is still old and smelly.