Drug Store News

Pharmacy sales surge in acquired stores

Pharmacy sales surge in acquired stores

Melissa C. Popolillo

Transition is smooth in former Harco and K&B stores

Rite Aid made a major push into the South last summer when it purchased the K&B and Harco chains. Market manager Nick Komocsin was charged with overseeing the transformation of 176 of the 186 acquired K&B stores to the Rite Aid format.

The stores are located in Louisiana, Texas, Alabama and Mississippi. The conversion process has been multifaceted, involving remerchandising and replanogramming the stores to match Rite Aid’s product mix, installing Rite Aid’s pharmacy system, RADS, and Rite Aid’s front-end computer, replacing all in-store and exterior signage and, more recently, physically changing the design of the stores. Changing signage alone took about three months because stores in some areas were subject to exterior signage restrictions.

New layout is next phase

Rite Aid has moved into the next phase of the conversion process of these stores, which involves altering the physical design and layout of departments. All 176 stores will have been remodeled by the year 2000. To date, two stores have been relocated from strip malls to freestanding locations, four underperforming stores have been closed, and eight stores are in the process of being remodeled to reflect the Rite Aid 1 prototype.

By late fall, Rite Aid plans to remodel 18 more of these former K&B stores in Louisiana, Alabama and Mississippi. All remodeling will be finished by the end of November and will restart in January after the holidays.

Rite Aid used television, billboard and circular advertising to draw customers into the stores and ease them through the transition. The ads emphasized pharmacy, and all indications are that the changes Rite Aid has made to these stores in pharmacy have been a boon to the stores.

Boost to pharmacy sales

“We had tremendous success with increased sales in the pharmacy department,” Komocsin said, noting that there has been double-digit growth since the acquisition. He attributed this growth to improved pharmacist training and the use of Rite Aid’s pharmacy system. As stores are remodeled, pharmacists will get a new work tool: RapidScript, an automated prescription filling and management tool that will enable pharmacists to process 75 prescriptions per hour.

In a two-pronged effort to warm customers to Rite Aid’s K&B takeover and to benefit an area hospital, Rite Aid held a garage sale in New Orleans, offering up such K&B memorabilia as the chain’s purple signs and bags, shopping carts, employee uniforms and other items. The chain raised more than four times what it had expected at the sale, reaching a total of about $22,000, all of which was donated to the New Orleans Children’s Hospital.

In fact, this market, which is managed by 176 store managers, three pharmacy development managers, eight district managers, one market security manager, one employee relations manager and one liquor department manager, has responded quite well to Rite Aid’s fundraising activities.

This market raised the third highest dollar figure of any Rite Aid market for Children’s Miracle Network this past year, bringing in $106,000 from the sale of $1 Miracle Balloons in the stores.

Overall, the transition has progressed well in the minds of the consumers, Komocsin said. “I’m sure at first customers didn’t want to see the K&B purple go, but [overall] customers were happy about Rite Aid coming into the market. The customers really like the Rite Aid private label because we have many more SKUs than K&B offered.

“I think it was a very successful acquisition and transition,” he concluded.

COPYRIGHT 1998 Lebhar-Friedman, Inc.

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