a good reason for that. The company is/has been in
the crapper for a long time. Rudderless, listless, no
strategy means no/lousy profits, underperforming stock and
stockholders heading for the exits (rightfully so, I might
<<<Stock is still very cheap
fundmentally and could be in beginning stages of a good move
I doubt that. Don't hold your breath waiting for
the big move up. I still recommend changing the
ticker symbol to DUMP. It's overdue.
<<Imitrex sale on insurance may give you
$1.00-$1.50 return on investment or perhaps 1-2% return
---low margin. >>
I must beg to differ.
Most (WAG) pharmacies run between a 20% and 32% gross
profit margin. Therefore, our theoretical $100 Imitrex
purchase yields, say, $25 gross profit. After salary and
rent, it comes to about $10 profit. And as WAG grows
and grows, the HQ expense gets spread over more
stores and take a much smaller bite out of the
Yes, the third-party plans have reduced the pharmacy
GP, but WAG is doing a better job than anybody in
stopping that slide in profit. Also, WAG is doing a better
job than anybody in filling more prescriptions with
less payroll, using technological advancements to make
the process more efficient.
The drive-thru is for RX pick-up and drop off not
merchandising. As a convenience you have to expect loss of sales
from front end in exchange for making new customers
and keeping existing patients.Imitrex sale on
insurance may give you $1.00-$1.50 return on investment or
perhaps 1-2% return ---low margin.
<<They need SHOPPERS not drive- buy
shooters. Marketers know this, cut back on store help since
they don't have the traffic. This makes the buying
experience a bad one for many of the foot trafficers.
I don't know about other retailers, but this is
definitely NOT the case at WAG. In fact, WAG has increased
it's front-end staff by guaranteeing that someone will
always be in the photo lab. This was made cost-effective
by installing the one-hour photo developing in
virtually all stores. This displays the intelligence of WAG
upper management: increasing the staffing/customer
service levels and making it profitable by giving them
something else to sell.
<< Either way he ""BUYS"" the product you
are selling. Burger joints, banks, etc don't lose a
sale because of drive-thru's. You deposit your money;
you pay your lones. How? Walk in, drive thru or mail.
That's how the convienience factor works for that
retail. Drug stores, WAWA shops, 7-11's need FOOT
TRAFFIC. They need SHOPPERS not drive- buy
While you make a good point that the product McD/BK are
selling is the one sold at the d/t, you are discounting
the huge difference in the average ring between fast
food and pharmacy. I imagine the average sale at ff
d/t is ~$4.50. At a pharmacy window, when you include
the third-party billing, your average sale is around
$40 or $50. Think of the woman on her way home after
a tough day who needs to pick up her presription
for Imitrex to fight the migraine she thinks she
might get; that's a $100 sale at the d/t. You've got to
sell a lot of burgers to equal that. So if you can add
some prescription business to the pharmacy because of
your convenient d/t window, it can more than make up
for missing a few candy bar sales on the front end.
Purchase strategy with regard to the split date
is interesting. I am currently considering WAG, but
have decided to wait until the split for the price to
settle a bit. When is the split date?
I'm not sure where the info. of profit margins in
the 100s came
from? I'm hoping you're not serious.
Don't confuse high margins
by manufacturers with
providers like WAG. WAG is probably closer
to the nat'l
gross margins for pharmacies that range from
26-30%. Also, Rx dept. only makes up 50% of the average
store revenue...store traffic will always be
important...just like real interaction with the patient/customer.
The margins on the drugs that WAG sells is so
good, they don't need them to come in and buy lost
leaders to drop their profit margins. They make their own
drugs!!!!! Profit margins are in the hundred fold!!!!!
yes, but what does that do for the front end
sales that are an important part of all retail? Won't
do the hurried customer any good when the stores
have to close/consolidate due to lack of revenue. The
liability factor is also a big part. That customer with
less time, in a hurry to get in and get out is the
very one that'll fail to be cautious going thru these
windows. Remember, the McD/Burgerking customer is getting
a burger. He either wants to sit and eat or drive
and eat. Either way he ""BUYS"" the product you are
selling. Burger joints, banks, etc don't lose a sale
because of drive-thru's. You deposit your money; you pay
your lones. How? Walk in, drive thru or mail. That's
how the convienience factor works for that retail.
Drug stores, WAWA shops, 7-11's need FOOT TRAFFIC.
They need SHOPPERS not drive- buy shooters. Marketers
know this, cut back on store help since they don't
have the traffic. This makes the buying experience a
bad one for many of the foot trafficers. End
result??lost buisness. School's still out but I believe, along
with many others in retail, it's a bad, bad idea for
drug stores!!! IMHO
I've glanced at the dell board, but haven't gone
back to far on it yet. But I got the value line sheet
at the library and am going to look at some of the
numbers. One nice thing about WAG is you can use the WAG
annual report as a benchmark for other company reports.
Makes fundamental analysis easier. BTW, I'm writing
this on a DELL (my second one). Always been satisfied
with their products and service.