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Walgreens: An Edge in the Drugstore Business
CharlesWalgreen, the founder ofUS’s top chain of drug stores, opened the firstWalgreen pharmacy store atChicago
in 1901. Ever since the first storewas opened,Walgreen (the store) had given importance to convenience of its customers
and had looked for innovativeways for increasing its customer base. One such examplewas the ‘TwoMinuteDrill’ a speedy
customer service practice, which the Walgreen store executed. Whenever a customer called Walgreen with an order,
Charleswould immediately send his clerk to deliver the prescription to the customer’s place,while he continued talkingwith
the customer over the phone. Further, to attract customers, Charles had installed a soda fountain at his store and he also
served milk shakes, ice creams and hot food...
Fighting the Mail-Order Operations
Themail order operations in the US pharmaceutical industry had begun as early as in 1946. Themedicine consumers
sent their purchase orders to the pharma drug stores throughmails (Box 1).Most of the prescriptions that were ordered by
the consumers throughmails were refillable prescription drugs. Refillable prescriptive drugsmeant thosemedicines that
were required to be taken on a regular basis such as, for blood pressure and cholesterol. During the 1960s and the 1970s,
the ordering of drugs throughmail order was very popular in the US.With the increasing usage of internet during the early
1990s, the pharma consumers started purchasing their regularmedicines by sending e-mails to the pharma stores...
Survival of the Fittest
During the past decade, the annual sales for prescription drugs have increased at an average of 20%forWalgreen
compared to an average increase of 13%for the whole industry.29 In fiscal year 2004 alone,Walgreens’ prescription sales
grew 17.8%, compared to the mail-order industry’s increase of 18%. The Chairman and Chief Executive Officer of
Walgreen, David Bernauer, expected its sales to growat a faster rate during the coming years. “U.S. prescription sales are
projected tomore than double in just nine years. Andwe atWalgreens expect ours to double in just about four years—better
than any other pharmacy retailer”, said the CEO...
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