continues to move its core CVS stores from strip malls to the more profitable freestanding locations. Only thirty-five percent of CVS’s stores are freestanding units, in comparison to Walgreens with over eighty percent. CVS is striving to catch Walgreens and has accelerated relocations as a percent of new store openings programs because the return on capital employed is more attractive as a result (Merrill Lynch). These locations are typically bought, not leased, with the store resembling the corner location proto-type of approximately 10,300 square feet. CVS has also increased their private label offerings to 1500 items, which account for 11 percent of its front store sales. Expansion plans have included the acquisition of Soma.com in 1999, which was then renamed CVS.com. This enabled CVS to provide an on-line pharmacy where customers can order prescriptions online for delivery or pick-up. CVS uses this website to bring their store into customers’ homes and businesses with information available to educate customers about medicines and diseases. In addition, current expansion plans include 440 new or relocated stores nationwide and entry into two new markets by 2000. CVS has not specified which new markets, but has confirmed relationships with two developers in the Chicago area who are scouting a minimum of fifty sites. In Chicago, there are no independent drugstore chains for CVS to overtake, thus they will be building from the ground up.Overall, CVS had been producing consistent earnings for gains for its shareholders and the three to five year outlook appears just as favorable (CVS Corp. NYSE). Successful acquisitions and continued operation of CVS.com, ProCare and PharmaCare Management Services have placed this corporation in a leading position with potential to overtake the market leader, Walgreens. In addition, CVS has confirmed that company sales growth should continue at ten percent or more for 2000. Drug...
