Walgreens

Walgreen Co. (NYSE: WAG), d/b/a Walgreens (without an apostrophe), is a leading pharmacy chain, mail service pharmacy, pharmacy benefit manager, and specialty pharmacy which has operations in 49 states and Puerto Rico. There are 6,148 Walgreens (as of December 31, 2007) in operation with a current goal to have 7,000 stores by 2010. Of the 6,148 Walgreens locations, 1,616 of them are open 24-hours, including the pharmacy. Over 4.7 million customers are served by Walgreens daily chain-wide and over 580 million prescription scripts are filled annually. Walgreens was founded in Chicago, Illinois, in 1901 and has since expanded throughout the United States. Its headquarters is located in Deerfield, Illinois, a suburb of Chicago. Its main competitors are CVS/pharmacy, Wal-Mart, Rite Aid as well as Target Corporation and Osco.

A typical Walgreens store is about 14,500 square feet with 11,000 square feet of sales area. They offer nearly 25,000 items for sale and typically staff between 25 and 30 people per store. On average, one store pulls in $8.5 million in annual sales. Most stores include a pharmacy, a photo lab, a cosmetics counter, and a general merchandise area. Select stores in metropolitan Chicago, Florida, Atlanta, Kansas City, Las Vegas, and St. Louis now include Walgreens TakeCare Health Clinics where certified (primarily nurse practitioners, and in some states, registered pharmacist) staff diagnose, treat, and prescribe for common illnesses and can also issue vaccinations and physicals in select locations. These clinics are open 7 days a week; including evenings and weekends with no appointments necessary and with acceptance of most major insurance plans. If a patient uses the TakeCare Clinic, their prescription is automatically processed through Walgreens' Intercom Plus Pharmacy System as a waiting prescription, so in most stores, the prescription is ready to be picked up in 15 to 20 minutes.

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History

Beginnings

  The Walgreens chain began as a drug store owned by Charles R. Walgreen, Sr.. ^[1]By 1915, there were five Walgreen drugstores. He added several improvements to the stores such as soda fountains and luncheon service. He also began to make his own line of drug products and was then able to control the quality of the items and sell them at lower prices. By 1916, 19 stores were in operation, all in Chicago. And in that same year, all the stores were consolidated under Walgreen Co. the 1920s was a very successful year for Walgreens. In 1921, the company opened stores outside of residentials areas and also introduced the malted milk shake in 1922. Walgreens also established its very own ice cream manufacturing plants to match the demand for ice cream at that time. By the mid 1920s, there were about 65 stores with an annual sale of 1.2 million dollars. By this time, Walgreens had expanded into other states like Wisconsin, Missouri, and Minnesota. By 1930, there were 397 stores in 87 cities with annual sales of 4 million dollars. The company did not really suffer from the Stock Market Crash and Great Depression. By 1934, Walgreens was operating in 33 states with over 600 stores. After Charles Walgreen Sr. died, his son Charles R. Walgreen Jr. took over and ran the chain until his retirement. The Charles R. Walgreen Jr. years were relatively prosperous, but lacked the massive expansion seen in the early part of the company. Charles "Cork" R. Walgreen III took over after Jr's retirement in the early 1970s, and brought the company through many modern initiatives, including the switch to a computer inventory based system (bar code scanning). The Walgreen family was not involved in senior management of the company for a short period following Charles' retirement. In 1995, Kevin P. Walgreen was made a vice-president and promoted to Senior Vice-President of Operations - Southern Division in 2006. ^[2]

Related ventures

Walgreens formerly owned Sanborns, the largest pharmacy chain in Mexico, having purchased Sanborns from Frank Sanborn in 1946 and selling it to Grupo Carso in 1985. ^[3]

In the 1980s, Walgreens owned and operated a chain of casual family restaurants named Wag's, a belated attempt to compete with Woolworth’s lunch counters. The Wag's restaurants were very similar in concept to Denny's. Walgreens sold most of these to Marriott Corporation in 1988^[4] and by 1991 the chain had completely gone out of business.

Walgreens is a sponsor of the Juvenile Diabetes Research Foundation and co-produced the Ron Santo documentary This Old Cub. It was created to help kids with diabetes

Contributions to popular culture

Walgreens claims responsibility for the popularization of the malted milkshake (or at least its version of the malted milkshake), invented by Ivar "Pop" Coulson in 1922 ^[5], although milkshakes and malted milk had been around for some time before. This development coincided with the invention of the electric blender in the same year.

Recent Expansion

The 1,000th Walgreen’s store, located at the intersection of Dearborn & Division in Chicago, opened at 9:00 a.m. on September 6, 1984. The ribbon cutting ceremony was presided over by Illinois Governor James R. Thompson and the movie superstar Cary Grant. Walgreens opened its 3000th store in Chicago in 2000. Its 4000th store opened in 2003 in Van Nuys, California, and most recently Walgreens opened its 5000th store in Richmond, Virginia in October of 2005. In October 2007, The Walgreen Company opened its six thousandth store in New Orleans, Louisiana.

Walgreens recently acquired the Happy Harry's chain of Delaware, Pennsylvania, Maryland, and New Jersey.

In 2003 Walgreens purchased 16 locations of the Vancouver, Washington based Hi-School Pharmacy Inc. stores, including the original Hi-School Pharmacy location in Vancouver, and converted them to Walgreens.

With the notable exceptions mentioned above, Walgreens expansion is different than that of competitors CVS/pharmacy and Rite Aid in that the company mostly expands by opening new stores in new markets instead of takeovers and acquisitions. This may actually benefit Walgreens in the long run, as both CVS and Rite Aid have experienced problems with this. CVS now has duplicate stores in Chicagoland after acquiring Albertsons's Osco Drugs chain while Rite Aid has several duplicate stores in the Mid-Atlantic region (more notably Pennsylvania) after its recent acquisition of Eckerd Pharmacy, and was only forced to sell off or close a handful of stores to meet regulations. Walgreens did buy a Rite Aid location in Zelienople, Pennsylvania, as well as 5 other locations as a result of the Eckerd/Rite Aid deal.

On July 12, 2006, David Bernauer stepped down as CEO of Walgreens and was replaced by company president, Jeff Rein. Holding degrees in accounting and pharmacy from the University of Arizona, Rein was a pharmacist, store manager, district manager, and treasurer prior to being named Chief Executive Officer and Chairman of the Board. Greg Wasson, former President of Walgreens Health Services, was named President and Chief Operations Officer.

Walgreens currently has plans to open its first store in Hawai'i. The store, located in Honolulu, is on track to be completed before November 2007. In the future, the company plans to operate 25-30 stores in the state on its various islands.

Health Corner TV

In 2004, Walgreens launched a sponsored TV show called "Health Corner", discussing health stories, tips, and advise to live a healthier life. The show is hosted by Lisa Thornton M.D. of Schwab Rehabilitation Hospital of Chicago, and co-hosted by TV and Radio personality Leeza Gibbons. Heatlh Corner aired Saturday Mornings on WGN-TV and on Superstation WGN until 2005, when woman's TV network Lifetime agreed to air the show on Sunday Mornings.

link title

Walgreens Health Services (WHS)

Main article: Walgreens Health Services

Walgreens Health Services [6], established in 1991, is a growing patient-care oriented business unit providing pharmacy benefit management (PBM), mail service pharmacy, home care, and specialty pharmacy services. Its primary division, Walgreens Health Initiatives (WHI), is a PBM whose client list contains over 400 health plans, employer groups, third parties, unions, government entities, and other types of organizations. WHI currently covers the prescription insurance benefits of 13.5 million individuals in a retail network of over 63,000 pharmacies.

Store model

  Originally, Walgreens stores were connected to local groceries, for example in Chicago, which is Walgreens primary market, they teamed up with either Eagle Food Centers or Dominick's Finer Foods, usually with a "walkthru" to the adjoining store and often sharing personnel. This concept was instated to compete with the popular dual store format used by chief competitor Jewel-Osco. Eventually, they ended the relationship with Eagle and focused primarily on a connection to the Dominick's stores, which were considered to be of a better quality. PharmX-Rexall stepped in and filled the vacated Walgreen locations joined to Eagle stores.

In its current business model, new Walgreens locations are most commonly set up as freestanding locations at the corners of busy, intersecting streets -- literally making it a "corner drugstore" similar to how many independent pharmacies evolved over the years in the United States. This also usually allows the store to offer additional conveniences such as a drive-thru pharmacy and 24-hour shopping that would not be possible in the average shopping mall. Walgreens also offers "auto refill". Customers can have their prescriptions automatically refilled each month for no additional charge. Walgreens sells freshly brewed drip coffees, Icees, and fountain beverages at select stores, as part of the pilot "Café W" program. Over 3000 locations have equipment to refill inkjet cartridges. As of March 2007, Walgreens has introduced flat pricing, $10 for black, and $15 for color.^[6]

References