Walgreens to Shut Down 1,200 Stores: A Glimpse into the Struggles of Drugstore Chains

Walgreens, a well-known drug store chain, is set to close around 1,200 of its locations by 2027. This move is a response to the challenges they're facing from online competitors and a drop in prescription drug payments. In the next year alone, about 500 stores will close, which is a big jump from the 300 closures announced earlier this year. The company has been having financial troubles, with about a quarter of its stores not making profits. Even though their sales have been better than expected, they still reported a $3 billion loss due to some big business deals that didn't work out. Retail experts like Neil Saunders from GlobalData Retail think this is a sign that Walgreens is in trouble and trying to fix things. He believes the company focused too much on growing through acquisitions and didn't pay enough attention to improving their stores and retail operations. This has led to many stores losing sales and not making money. Drugstore chains are going through a tough time. Stores like CVS and Rite Aid have also been struggling because prescription drug reimbursements have been lower and there's new competition from big players like Amazon. Just last month, CVS said they were cutting about 2,900 jobs to save money. Even the parts of drugstores that sell snacks and household items are feeling the heat from bigger competitors like Target. In May, Walgreens tried to attract shoppers by lowering prices on over 1,000 items. Their CEO, Tim Wentworth, said that turning things around will take time, but it will be worth it in the long run. Saunders thinks that getting rid of unprofitable stores will help Walgreens financially over time, but it's also a big admission of failure.