Walgreens CEO says customers are ‘more cautious’ as pharmacy lays off 400 employees after announcing 150 store closures
WALGREENS CEO Rosalind Brewer said customers are “more cautious” than before as the chain announces 400 job cuts.
The retailer has already announced plans to close 150 stores nationwide.
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On Wednesday, Walgreens announced it would lose a total of 393 jobs as one of its 17 distribution centers will close.
Walgreens CEO Rosalind Brewer said last month that the company is facing a “challenging operating environment” that is bringing with it a “more cautious and value-oriented consumer.”
The layoffs will affect all employees at the distribution center in Edwardsville, Illinois, who will soon be terminated with 60 days’ notice.
The work of this center is now taken over by employees of the former drugstores.
Walgreens is taking serious cost-cutting measures after the company announced major financial losses.
For the quarter ended May 31, the dispensary lost $2.9 billion, primarily due to $5.5 billion in opioid-related legal settlement payouts.
That’s a massive drop in revenue compared to the same quarter last year, when Walgreens posted a $4.8 billion profit.
Walgreens Boots Alliance, Walgreens’ parent company, has already shed about 10 percent of its US workforce through corporate and office layoffs.
store closures
Meanwhile, customers will be impacted by plans to close 150 Walgreens stores nationwide.
The list of affected locations has not yet been released and the company did not say when the stores will close.
“PHARMACY OF THE FUTURE”
To continue successfully, Walgreens now wants to upgrade its existing stores to become what CFO James Kehoe calls the “dispensary of the future.”
“We are optimizing the model through our micro-fulfillment centers, technology-enabled centralization of in-store activities and telepharmacy solutions,” he said.
The chief executive explained that a drop in consumer spending and a drop in demand for Covid vaccines resulted in significantly lower earnings for Walgreens.
Walgreens Boots Alliance also announced the closure of 300 UK-based Boots pharmacies.
Meanwhile, national rival CVS has announced plans to close hundreds of locations.
In January, the company said it would be closing about 300 stores a year until 900 locations were closed by 2026.
Rite Aid is also closing stores. This year, 25 locations have already been closed and more are at risk of being closed.
And a Walmart pharmacy recently closed for good after 20 years.