CVS is Closing 900 Retail Stores by 2025.
The reason? Inflation? Lack of demand? Or is it digitalization?
For those that don't know, CVS is a drugstore chain running nationwide. Providing medical convenience to local consumers. They work directly with insurance providers and drug pharmaceuticals to give the best services possible for anyone in need.
When we say Brick and Mortar, CVS took the brick part literally.
CVS made a big leap into the retail market by investing in up to 10,000 stores in the United States compared to their closest competitor Rite-Aids' 2,500.
So why would they want to close their stores if they dominate the market? For one, inflation definitely causes panic in that number of stores. The demand for products is leaving a lot of companies to resort to the liquidation of assets or in the worst-case scenario, bankruptcy.
Although drug-related products saw a rise in consumer purchases in recent years, thanks to the pandemic. Price margins on those products can cause a loss of revenue stream as the general cost continues to rise.
The best reason though is the new plan CVS is going to be implementing in the coming years.
CVS is trying to invest more in financial technology to provide a more flexible method of payment for consumers. This will increase their eCommerce sales strategy tenfold by allowing more pick-up and check-out options--Brand Digitalization.
CVS has a specific sign for closing stores
CVS is one of the many companies that are getting smart. They are investing in digital store fronts instead of brick and mortar stores due in part that fewer and fewer people are deciding to shop physically these days. It is just that much more convenient to wait for a product to show up at your door than to go to a store potentially miles away only to learn they also have to order the product.
When it comes to drug-related products, the demand will always be there. Products will fly off shelves like hot cakes and sometimes these retail chain stores simply just can't keep up with that demand.
CVS knows the only way to combat this is to push into the eCommerce world. Do you? Black Mountain posts blog posts weekly about the changing market and what you could be doing to better your brand. You can check out our entire article feed here.