Rite Aid
Careers at Rite Aid
Mission
Rite-Aid’s mission is to improve the health and wellness of its communities through engaging experiences that provide its customers with the best products, services, and advice to meet their unique needs.
Business segments
Rite Aid is a drugstore chain. The firm operates two reportable business segments:
- Retail Pharmacy Segment – Consists of Rite Aid stores, RediClinic, and Health Dialog. Provides prescription drugs and a broad assortment of other merchandise, called "front-end" products.
- Pharmacy Services Segment – Consists of EnvisionRx, a pharmacy benefit management (PBM) provider. Provides a wide selection of pharmacy-related services.
History
Alex Grass’s father-in-law owned a company called Lehrman & Sons. In 1958 Grass founded a subsidiary of the firm called Rack Rite Distributors that rented and stocked grocery store racks with beauty and health aids. In 1962 Grass established an offshoot of Rack Rite called Thrift D Discount Center, a retailer of health and beauty aids that had a pharmacy, in Scranton, Pennsylvania.
The new chain grew quickly through new locations and acquisitions. By 1965 it operated 23 stores and had expanded into five states in the Northeast. That year its name was changed to Rite Aid. In 1968 it officially became Rite Aid Corporation, going public on the American Stock Exchange. In 1970 it transitioned to the New York Stock Exchange. By 1971 it had 267 stores in 10 states.
Ten years later, in 1981, Rite Aid was named the third largest drugstore in the U.S., and in 1983 sales reached $1 billion. Over the next two decades it grew larger through numerous store acquisitions, including Gray Drug, Hook’s Drug, and Peoples Drug. In 1999 it established a strategic alliance with General Nutrition Companies through which it would include GNC “stores” in its locations.
That same year the company installed a new management team to complete a turnaround plan due to slowing sales. In 2004 it unveiled its new strategic initiatives, which included a thorough focus on patient health and wellness programs. In 2015 Walgreens Boots Alliance made a merger offer and Rite Aid accepted. The deal is currently pending government approval.
Business model of Rite Aid
Customer Segments
Rite Aid has a mass market business model, with no significant differentiation between customer segments. The company targets its offerings at all consumers who seek retail pharmacy products and services.
Value Proposition
Rite Aid offers three primary value propositions: convenience, cost reduction, and brand/status.
The company offers accessibility by making certain services easy to use. It maintains a subsidiary called RediClinic, through which it operates retail clinics in several locations. The outlets are staffed by physician assistants and board-certified nurse practitioners who can treat over 30 common medical conditions and write prescriptions. They can also provide a wide variety of preventive services, including screenings, medical tests, immunizations, and basic physical exams. The clinics are useful for consumers who are unable to access traditional health care facilities at a given time.
The company reduces costs through a variety of options. It operates the wellness+ with Plenti loyalty program, through which it offers consumers in-store savings and the ability to redeem coupons. Members can also earn points for puchases that can lead to up to 20% off non-sale prices.
The company has established a powerful brand due to its success. It is the third largest retail drugstore chain in the U.S. and largest on the East Coast in terms of number of stores and revenues. It maintains over 4,600 stores in 31 states and in the District of Columbia.
Channels
Rite Aid’s main channel is its network of retail stores located around the country. The company promotes its offerings through its website, social media pages, broadcast/digital advertising, loyalty programs, contests/sweepstakes, and educational programs focused on specific health concerns.
Customer Relationships
Rite Aid’s customer relationship is primarily of a self-service nature. Customers utilize its products while having limited interaction with employees. That said, its RediClinics offer a personal assistance component through the provision of health care services for consumers.
Key Activities
Rite Aid’s business model entails distributing retail pharmacy products and delivering related services to customers.
Key Partners
Rite Aid’s key partners are as follows:
- It purchases all of its branded pharmaceutical products and nearly all of its generic pharmaceutical products from McKesson Corporation.
- It purchases its non-pharmaceutical merchandise from various manufacturers and wholesalers.
- It sells private brand and co-branded products supplied by several competitive sources.
- It maintains a strategic alliance with GNC through which it operates more than 2,300 GNC stores within Rite Aid stores and will open at least 170 additional ones by December 2019.
Key Resources
Rite Aid’s main resources are its physical resources, namely the over 4,600 retail drugstores it operates around the country. It also maintains important human resources in the form of its 88,000 Retail Pharmacy segment associates and 1,500 Pharmacy Services segment associates.
Cost Structure
Rite Aid has a cost-driven structure, aiming to minimize expenses through significant automation and low-price value propositions. Its biggest cost driver is cost of revenues, a variable expense. Other major drivers are in the areas of sales/marketing and administration, both fixed costs.
Revenue Streams
Rite Aid has one revenue stream: revenues generated from the sales of its products (primarily merchandise and prescription drugs) to customers.
