NEW YORK -- Two of the nation's leading drug store chains presented a bullish outlook for their companies and the industry at a recent financial conference here.
Mark Wagner, vice president and treasurer, Walgreen Co., Deerfield, Ill., said the chain will continue opening a new store every 18 hours -- often in a competitor's neighborhood in retirement-friendly states -- to "chip away" at the competition.
"It's almost like water on a rock. It's a slow process, but eventually we'll win the battle," he said in a presentation at the UBS Warburg Global Consumer Conference here Oct. 31 to Nov. 1.
Wagner said initiatives like opening more 24-hour stores and putting advanced technology in the pharmacy helped spur sales growth for the 100-year-old retailer. However, he said the ongoing pharmacy shortage caused Walgreens to level off its store expansion plans, with 365 net new stores to be added during the next three to five years.
Meanwhile Mary Hammonds, president and chief operating officer, Rite Aid, Camp Hill, Pa., said she expected the chain's growth to come more from productivity enhancements. Among the measures the company will take to increase productivity are new tools she called "shrink scorecards."
She also said the company would continue to aggressively roll out new private-label merchandise in its stores and add in-store GNC Nutrition Centers in the coming year. The company currently derives about 11% of its nonpharmacy sales from private-label products, and Hammonds said she expects that to increase by a few percentage points.