Inside This Issue - Opinion
Some things to watch for as the year unfolds
January 17th, 2011
by David Pinto
Here are seven things guaranteed — or not — to happen in the chain drug retailing arena in 2011.
• The National Association of Chain Drug Stores will finally begin to address some of the issues that have kept the organization from realizing its potential to fully dominate the retail trade association arena. As a necessary first step in that direction, it will insure that its much — and often unfairly — maligned Marketplace Conference receives the pre-publicity it needs to generate sufficient retailer and supplier interest and unfolds with opportunities enough to justify that interest.
As well, the association needs to increase the opportunities for retailer-supplier interaction this year — perhaps by scheduling an additional board meeting around the Marketplace Conference — while smoothing out the asperities that attend and disrupt the immensely valuable and productive December meetings. Finding a more suitable location for the December board dinner would be a good place to start.
Indeed, if NACDS is to retain and enhance its hard-earned and justly deserved reputation as the premier trade organization serving the mass retailing community, it must do more than merely influence the legislative and regulatory environments in which it operates. It must, as well, more effectively influence the membership that it serves.
• CVS Caremark will name a president for its drug store unit — and that president will not have previously worked at Walmart. Having given its senior staff and various constituencies ample time to recover from its ill-considered choice to succeed Larry Merlo as head of the CVS drug chain, the organization will shortly announce the name of its new candidate for the job.
That candidate will likely come from outside the organization, if for no other reason than the first candidate was an outsider. But some people both inside and outside CVS believe it might make sense, both practically and politically, to review the internal candidates again before making a final decision. Time will tell.
• Tom Ryan and Mary Sammons will gracefully leave the chain drug stage they have deservedly dominated for so long. Each will graciously accept the awards that await them in the near term — remembering Sherlock Holmes’ edict that it is as big a mistake to make too little of one’s accomplishments as it is to make too much of them — then will, of their own choosing, leave chain drug retailing to pursue other opportunities — or to disappear entirely from the business community they served so capably for so long.
In either case, it will be a long time before their respective companies forget them — and they will remain part of chain drug community lore, in memory, for as long as that industry plies its trade.
• Kerr Drug, already recognized as the practitioner of community pharmacy that has raised the profession to new levels of ambition and accomplishment, will advance its prototypical model still further, and finally begin receiving the recognition and acclaim that model so richly deserves. Indeed, 2011 will become the year that Kerr’s medication therapy management model is no longer viewed as the practice model at odds with the norm but, instead, begins its journey to be recognized as the norm.
• Walgreens, its transformation largely complete and its innovative front-end and pharmacy programs securely in place, will enjoy the most successful year in its 110-year history. Additionally, its senior staff, much maligned and second-guessed in the chain drug community over the past year, will begin getting the recognition it has so richly earned for transforming a drug chain that badly needed transforming, and for discarding a game plan that no longer worked in favor of a fresh and exciting approach to drug store retailing.
• Rite Aid will finally face its Gethsemene. In other words, 2011 will be the year that America’s No. 3 drug chain either begins attracting new customers and additional sales or will be forced to pursue other roads to prosperity.
Until December, when it managed a 0.6% gain, Rite Aid had seen its monthly same-store sales dip for the past 17 months. That’s hardly a formula for success. And its food experiment with Supervalu, while laudable, is hardly the answer to the retailer’s long-term objective of increased customer traffic.
• Later this month Jim Devine and the Chain Drug Marketing Association will celebrate the 85th anniversary of its predecessor organizations. Devine has been recognized in this publication on prior occasions. But he once again must be congratulated for building a niche for a drug store-based organization that had been written off so many times over the past few years. If CDMA isn’t a mandatory stop for suppliers making the association rounds, it is a serendipitous one in the sense that those industry people who find it are usually glad they did.