PHARMACY ON THE FRONT LINE

Stephanie Loughran

With the advent of pharmacy in supermarkets in the 1960s, supermarkets have worked to change the perception of the department from a mere customer convenience to a respected whole-health professional service.

The innovators were retailers like Giant Food, Landover, Md., and Pathmark Stores, Carteret, N.J., in the early 1960s. Then in the 1970s, the Skaggs-Albertson's grocery-and-drug combination format gained widespread industry recognition and inspired imitators. These companies' experiences were catalysts for other retailers that created their own pharmacies to battle drug store incursions into food and to retain customer loyalty.

In pharmacies' infancy, however, the departments were little more than drug-transaction stations on the customers' way out the door.

"There was a time where the pharmacist wasn't allowed to talk about the drugs to the patient," said J.B. Pratt, chief executive officer, Pratt Foods, Shawnee, Okla. "Your doctor said to do this, so do it." The 70,000-square-foot combo format created by Skaggs and Albertson's in 1969 "is the real landmark when the pharmacy really came into its own in the supermarket," he said.

Convenience was the driving force in creating in-store pharmacies, agreed John Shepherd, vice president, food stores, National Association of Chain Drug Stores, Alexandria, Va.

"Pharmacy has developed from a novel reflection of the operator's desire to add something new and different to a full-fledged key for the success of the enterprise. Its evolution in the shopper's mind is from an extra service to a necessary and expected part of the overall mix," he said.

Convenience and a way to fight competition from drug stores went hand-in-hand in bringing pharmacy services to grocery stores, said Laurie Gethin, senior manager, pharmacy services, Food Marketing Institute, Washington.

"It was probably seen as a one-stop-shopping advantage, but that in itself is a competitive weapon," she said.

While the growth of pharmacies was progressive in past decades, the development of in-store supermarket pharmacies has doubled from 4,461 outlets in 1991 to 9,255 outlets in 2001, according to FMI's report from the 2002 Supermarket Pharmacy Survey. Moreover, nearly six in 10 new stores had pharmacies in 2000, reported FMI's Facts About Store Development 2001.

"There's such a demand to have pharmacies in stores, it's expected," said Ted Fullerton, vice president, retail operations, Minyard Food Stores, Coppell, Texas. "As the population ages, they use more drugs. Like a produce department and meat department, you need to have a pharmacy."

About 90% of all food operators with pharmacies belong to NACDS, and supermarket chains now make up a third of the membership along with mass and drug, Shepherd said.

Pharmacies' tie-in with health and beauty care products, like over-the-counter remedies, was evident early, said industry sources.

"More prescription drugs have become OTC over the years, so people have more questions," Pratt said.

The change in perception from a medication provider to more of a whole-health professional was effected by the growth of nutritional supplements, said Pratt. Pratt's merchandised supplements for the first time in 1989, he said. In the mid-1990s, the department moved near the pharmacy because the retailer "ran out of room."

Pratt recalled, "It was an extensive endeavor, but it was the best thing we ever did, and it put pharmacy in first position in that store."

Operators noticed significant 30% to 35% gains in HBC and pharmacy areas after retrofitting a pharmacy department, said Shepherd.

"Suddenly, there was more restocking of shelves and less dusting of product," he noted.

The two departments have had a natural impact on each other, Gethin said. The advent of more superstores in the 1980s "renewed a burst of interest" for supermarket pharmacies, Shepherd told SN.

"These units featured full-service departments to address the renewed focus on one-stop shopping," he said.

The perception of supermarket pharmacists in particular have come a long way, noted industry sources.

"There was initial skepticism, and the pharmacies were not positioned and established in the most professional way," said Roy White, vice president, education, General Merchandise Distributors Council, Colorado Springs, Colo.

"The culture of a supermarket pharmacy where families shop is a family culture, and you can't find that in any other place," said Pratt.