Tue Oct 15 11:20:00 UTC 2024: ## Walgreens to Close 1,200 Stores Amidst Struggles with Online Competitors and Declining Prescription Drug Payments
**Chicago, IL** – Walgreens Boots Alliance (WBA) announced Tuesday that it will close approximately 1,200 locations over the next few years, representing a significant escalation of the company’s cost-cutting measures. The move comes as the drugstore chain grapples with declining prescription drug reimbursements and fierce competition from online retailers like Amazon.
By 2027, roughly one in seven Walgreens stores currently open will be shuttered. The company has already begun the process, closing 500 stores over the next year. This follows the closure of 300 underperforming locations in June, part of a multiyear optimization program launched by CEO Tim Wentworth.
Despite the closures, Walgreens reported stronger-than-expected sales in the recent quarter, with revenue rising 6% year-over-year. However, the company incurred a $3 billion loss due to a writedown of a Chinese pharmaceutical chain and a home care provider.
Walgreens is not alone in its struggle. Major drugstore chains, including CVS and Rite Aid, have also been hit by declining prescription drug profits and increased competition. CVS recently announced job cuts and a $2 billion cost-saving initiative.
The front-end of drugstores, where they sell snacks and household staples, faces pressure from larger competitors like Target and even Dollar General, particularly in rural areas.
Walgreens has taken steps to address the challenges, including slashing prices on over 1,000 items in an effort to attract inflation-weary shoppers. However, CEO Wentworth acknowledges that the company’s turnaround “will take time” but promises “significant financial and consumer benefits over the long term.”
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