NACDS CHAIRMAN CALLS FOR SPIRIT OF 'CO-OPETITION'

CHRISTINA VEIDERS

SAN DIEGO -- Jerry Heller, president and chief executive officer of May's Drug Stores, Tulsa, Okla., called for retailers and suppliers to work together in a spirit of "co-opetition." Addressing another attendance record-breaking Marketplace Conference here last month, hosted by the National Association of Chain Drug Stores, Alexandria, Va., Heller returned to the post he served in 1989 to again be this year's NACDS chairman. He said the term "co-opetition" better reflected the working relationships between retailers and suppliers. "We are all in business to make money," he stated. Heller chided the supplier community in claiming to want to serve a large customer base. "I am here to tell you your actions don't resemble your words," he said, adding that many of the policies practiced by manufacturers would have a long-term negative effect on their companies.

The drug store channel will survive because of its ability to adapt to changing customer needs, said Heller. "An example of this is our pharmacy computer system," he pointed out. This system was developed to eliminate the inconvenience of customers having to submit forms to get reimbursed for their prescriptions.

"Today, still, we are the only segment of the health care delivery system to provide this benefit to our patients," he said.

Heller said drug stores won't ever achieve the efficiencies of large retailers because of their small size. However, the industry has improved its efficiency over the last five years and has been able to reduce its operating costs, he added.

According to Heller, drug store pharmacy market share is at an all-time high. In health and beauty care sales, drug stores' market share is only one share point lower than it was 10 years ago, said Heller.

He also credited smaller retailers for being innovators in the industry. They have introduced convenience foods, drive-up pharmacy windows and pharmacy computers, said Heller.

The Marketplace Conference has grown each year over the last decade. This year's attendance, at more than 4,200 people, was up several percentage points over last year. There were 614 exhibitors and 550 buyers. The first Marketplace Conference 10 years ago drew just over 1,000 attendees and 200 exhibitor booths.