NORFOLK, Va. -- Farm Fresh here and Drug Emporium, Powell, Ohio, have reached an agreement under which two of Farm Fresh's Rack & Sack stores will have Drug Emporium discount drug operations replace existing departments.
"It is the first time that a Drug Emporium will be operated within a supermarket setting," said Keith Alessi, vice chairman of Farm Fresh.
Under a five-year agreement with Drug Emporium, Farm Fresh will license the Drug Emporium name and operate sections in two Richmond, Va., Rack & Sack locations. Farm Fresh owns nine other Rack & Sack stores, but doesn't plan to expand the concept to them because Drug Emporium stores already operate in the vicinity.
"We are affiliating with Drug Emporium because we feel that the Drug Emporium name will give us a stronger presence in the marketplace," Alessi said.
Under the agreement, which took effect last week, Farm Fresh also will use Drug Emporium's strong buying power, enabling it to purchase products at lower prices, according to Alessi.
"We will be able to deliver products to our consumers at a substantial savings over our existing operation," Alessi said. He declined to supply a specific cost savings.
"This is a new format for Drug Emporium," said David Kriegel, chairman and chief executive officer of Drug Emporium, said in a statement. "The one-stop-shopping concept has great potential for both Farm Fresh and Drug Emporium."
Michael Julian, chairman and chief executive officer of Farm Fresh, added, "Drug Emporium will further strengthen the discount image we communicate to our Rack & Sack customers."