Shop Talk

Retailers, consumers and prices

Check Out Line: Have a flu shot, spend some more

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flushot1Check out the impact of signs the U.S. flu season may be weaker this year.

Drug stores such as Walgreen, CVS and Rite Aid are offering flu shots earlier and more conveniently to keep sales from slumping with no expected H1N1 outbreak this year along the lines of last year.

Last year, consumers came for flu shots and bought other items as well, but those related sales could suffer this year. Walgreen, for example, said lower demand for flu-related prescriptions cut 0.3 percentage point from its same-store sales growth in August.

This year, drug stores began promoting flu shots in late August, a week earlier than last year.

Making it tougher for drug stores are rivals like grocery stores (Supervalu and Kroger), and big-box retailers (Target) have been offering flu shots as well.

Check Out Line: Walgreen, CVS back together

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WALGREEN/Check out the happy ending to the fight between CVS Caremark and Walgreen over reimbursements for drug prescriptions.

The two drugstore chains left their differences behind and announced a new “multi-year” deal, salvaging a relationship worth billions of dollars.

Walgreen’s shiny new purchase

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Walgreen officially owns New York’s Duane Reade drugstore chain as of Friday, less than two months after the deal was announced.  Walgreen, which got its start in Chicago and is based in a nearby Illinois suburb, is now the biggest drugstore operator in New York City after adding 258 Duane Reade stores, two distribution centers and a corporate office to its 70 stores in the area.

A small percentage of Duane Reade’s stores are rather snazzy, some new and others renovated, and stand out compared to other drugstores, including Walgreens stores, in the Big Apple.  Those makeovers and Duane Reade’s strong push into private label products were some of what attract Walgreen, which is working on its own store upgrades. (But there are still dozens of Duane Reade stores that have yet to get a makeover.)

Check Out Line: Rising sales at Walgreen

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walgreen1Check out the higher sales at Walgreen stores open at least a year.

The largest U.S. drugstore chain said March sales at locations open at least a year rose 2.3 percent thanks to an earlier Easter holiday that drove demand for candy and other merchandise. Walgreen also said an extra weekday boosted sales of prescription medications.

March 2010 had an extra weekday and one less weekend than the previous year, and consumers tend to fill more prescriptions on weekdays.

Check Out Line: Power plays in the air

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walgreen1Check out the power plays going on in the consumer world.

Walgreen said it will buy Duane Reed for $618 million in cash, catapulting the largest U.S. drugstore operator into the top spot in the New York City area. The deal price also includes the assumption of $457 million in debt.

Duane Reed is owned by private equity firm Oak Hill Capital Partners and operates 257 drugstores in the New York metropolitan area. Duane Reade will continue to operate under its brand name, and Walgreen expects to retain the employees at its stores, pharmacies and distribution centers.

Check Out Line: Walgreen sales catch a cold

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WALGREEN/Check out a dose of bad medicine for Walgreen.

Analysts had expected the No. 1 U.S. drugstore chain operator to post a 2.2 percent increase in same-store sales. But the company instead posted a surprise 1.1 percent drop.

Among factors that hurt the company were a calendar shift. This January had one less weekday in it than last year. That might not seem like a big deal, but Walgreen fills more prescriptions during the week so the shift cut 1.3 percentage points from the same-store sales increase.

Pharmacy same-store sales fell 1.2 percent, a decline made worse by the fact that some of those sales have were in the form of H1N1 flu shots, a one-time item.

Check Out Line: Walgreen sales plenty to sneeze at

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WALGREEN/Check out the sickly same-store sales at Walgreen.

Same-store sales of general merchandise fell 3.1 percent, with the company saying a decision to stock fewer seasonal items caused much of then drop.

Walgreen, like most retailers, had to sharply discount seasonal items in the teeth of the recession last year.

Check Out Line: Flu vaccinations aid drugstores

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WALGREEN/

Check out Walgreen’s sales growth.

Walgreen Co, the largest U.S. drugstore chain, said on Friday that September sales at its stores open at least one year rose 5.3 percent, thanks to in-store flu vaccinations and people filling more 90-day prescriptions.

Sales of general merchandise, which consumers have been shying away from in past months, also rose for the first time since May for Walgreen.

Check Out Line: Walgreen has prescription for profits

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walgreen12Check out the better-than-expected profit at Walgreen.

The largest U.S. drugstore chain saw shares rise 10 percent as its fourth-quarter profit benefited from a make-over that includes sprucing up stores and cutting jobs.

Walgreen also announced a new plan to promote 90-day prescriptions available at its stores as an alternative to the mail-order programs favored by many insurance programs.

Drugstores duke it out for first place

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Statisticians in the drugstore industry (if they are out there), must be scratching their heads.

CVS opened its 7,000th store on Sunday.  It was a pretty big deal, with the drugstore company’s president, Larry Merlo, even heading to Little Canada, Minnesota, for Thursday’s grand opening celebration.

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