Walgreens announced plans to close 1,200 stores over the next three years as part of a downsizing effort due to flagging sales and changing consumer behavior. About 500 closures are expected in the next 12 months, with a quarter of its 8,700 U.S. stores found to be unprofitable. The company’s CEO, Tim Wentworth, stated that this move is part of a turnaround strategy that will take time but will ultimately benefit the company financially. CVS also plans to close about 900 stores, or 10% of its U.S. locations, from 2022 to 2024. The pharmacy industry has been facing challenges such as lower reimbursements from pharmacy benefit managers (PBMs), resulting in a greater number of “pharmacy deserts” across the country. Walgreens’ announcement comes after Rite Aid emerged from bankruptcy and amid ongoing regulatory reforms targeting PBMs. Neil Saunders, GlobalData’s retail managing director, noted that the retail pharmacy industry is undergoing changes to adapt to new consumer habits. Overall, the closure of Walgreens stores reflects a broader trend in the industry as companies reassess their business models and adjust to meet the evolving needs of consumers.
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Walgreens Announces Plan to Shut Down 1,200 Stores in the Next Three Years
