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Rite Aid Corporation Message Board

  • daninfw04 daninfw04 Feb 10, 2013 4:34 PM Flag

    Store Closures

    I keep reading negativity about RAD closing unprofitable stores. I spent 40 years+ in retail. It is not unusual that if there are unprofitable stores being kept open because someone doesn't want to make the tough decisions........two unprofitable stores can wipe out the entire profits of as many as 8 other profitbale stores. If the closed stores that were unprofitable are in close proximity to other stores they can easily recoup 15-30% on average of the business from closed stores which makes the already profitable stores even more profitable. I suspect that with RAD moving their prescriptions from closed stores to nearby open stores they should easily retain that. My experience was to take over unprofitable operations and companies and to make them profitable. One time I closed 5% of the stores in a chain and it improved profitablity over 20% immediately for the entire remaining operation. I would add it's also the old 80-20 rule. District and Region management often spend 80% of their time trying to turn around the 20% that are problem stores instead of focusing on how to make the other stores more profitable. The smart ones out there will understand this. The rest won't. DaninFW

    Sentiment: Strong Buy

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