Walgreens Future Trends
Walgreens’ Future Market Trends Market Structure
Walgreens Pharmacy operates in an Oligopoly market structure. The retail pharmacy environment also has the Oligopoly characteristic of significant entry barriers. The barriers are restriction of ownership and restriction of where the business can be established (Walgreens). The ownership barriers are established by the government and state only Pharmacists or an incorporated company that has directors and shareholder members that are registered pharmacists are allowed to open and own a pharmacy. Licensed pharmacists are required to be on duty during the hours of operations.
Current Economic Trends
Walgreens faces many challenges. In the face of a slowing economy families are making tough decision on how to spend money. Many American are making the choice of putting food on the table or buying medication. Some of the challenges that Walgreens must face are a slowing economy, new competition, and government regulations changes. Pharmacy sales and script counts as an industry are slowing. From 2007-2008 sales increased 1.8% from 249.2 billion from 253.6 billion. Script counts increased 0.6% from 3.52 billion scripts to 3.54 billion scripts. Walgreens is a company that is use to double digit growth numbers. To face the new slowing economy Walgreens has created a program called Rewiring for growth and POWER.
The Walgreens Rewiring for growth project is about protecting the company’s profits in a slowing economy. The program will reduce operating cost and create more productivity. The program will realign Walgreens capabilities, culture, and costs to meet its goals and the current economic environment. The target savings is one billion dollars in annual cost savings by 2011. The saving will be reached by reducing over head at corporate and work throughout stores. Walgreens has also planned to open fewer stores in the future and concentrate on extracting more profit from existing stores. Rewiring for growth will
Walgreens Pharmacy operates in an Oligopoly market structure. The retail pharmacy environment also has the Oligopoly characteristic of significant entry barriers. The barriers are restriction of ownership and restriction of where the business can be established (Walgreens). The ownership barriers are established by the government and state only Pharmacists or an incorporated company that has directors and shareholder members that are registered pharmacists are allowed to open and own a pharmacy. Licensed pharmacists are required to be on duty during the hours of operations.
Current Economic Trends
Walgreens faces many challenges. In the face of a slowing economy families are making tough decision on how to spend money. Many American are making the choice of putting food on the table or buying medication. Some of the challenges that Walgreens must face are a slowing economy, new competition, and government regulations changes. Pharmacy sales and script counts as an industry are slowing. From 2007-2008 sales increased 1.8% from 249.2 billion from 253.6 billion. Script counts increased 0.6% from 3.52 billion scripts to 3.54 billion scripts. Walgreens is a company that is use to double digit growth numbers. To face the new slowing economy Walgreens has created a program called Rewiring for growth and POWER.
The Walgreens Rewiring for growth project is about protecting the company’s profits in a slowing economy. The program will reduce operating cost and create more productivity. The program will realign Walgreens capabilities, culture, and costs to meet its goals and the current economic environment. The target savings is one billion dollars in annual cost savings by 2011. The saving will be reached by reducing over head at corporate and work throughout stores. Walgreens has also planned to open fewer stores in the future and concentrate on extracting more profit from existing stores. Rewiring for growth will
References: Walgreens Co (2009). Walgreens Company Info. Retrieved August 16, 2009, from http://news.walgreens.com/article_display.cfm?article_id=1046 Coogler, T. (n.d.). How to Open an Independent Pharmacy Business. Retrieved 08 22, 2009, from E how: http://www.ehow.com/how_4576914_open-independant-pharmacy-business.html Walgreens. (2009). Walgreens Prescription Savings Club. Retrieved 08 29, 2009, from https://webapp.walgreens.com/MYWCARDWeb/servlet/walgreens.wcard.proxy.WCardInternetProxy/RxSavingsRH Mullis K. (2006). A SWOT Analysis of Walgreens in the Competitive Pharmacy Marketplace. Retrieved August 24, 2009, from http://acraretail.org/documents/Katy_Mullis_-_Walgreens_SWOT_Analysis.pdf