tores are freestanding buildings located at major intersections, as opposed to shopping centers and strip malls. Within the past five years, approximately 60 percent of Walgreens’ stores have been opened or remodeled, and more than 50 percent offer drive-through prescription service. Walgreens plans to open 450 units in fiscal 2000, with a goal of 6,000 stores by fiscal 2010. Pharmacy sales account for about 52 percent of total sales. The company, which was already a leading dispenser of prescriptions in the U.S., boosted pharmacy sales 23 percent in fiscal 1999 (with a gain of 19 percent for comparable drugs). Recent technological advances include satellite linkage to all stores and facilities, point-of-sale scanning and implementation of the Strategic Inventory Management System (SIMS), which unites all elements of the purchasing, distribution and sales cycle. This will reduce inventory, improve in-stock positions and provide quicker reaction to sales trends. The Intercom on-line pharmacy system links all stores with headquarters and one another. Healthcare Plus, Walgreens’ pharmacy mail-order subsidiary, offers sales, marketing and operational support for third-party retail and mail-order prescriptions through two facilities. The company has also formed a pharmacy benefits manager, WHP Health Initiatives, targeting small to medium-size employers and HMOs. There is concern about saturation in the drug retailing industry, prompted by what appears to have been a ramp-up in store openings by the major players. With the exception of Walgreens, the large drug chains have been focusing more on relocation as they aim to get a majority of their store base to freestanding locations. Excluding acquisitions, they have barely increased the number of stores under operation in the last three years. In addition, Eckerds has started a large-scale store-closing program that will free up additional share for the taking (Walgreens 1999 Annu...
