Wednesday, April 7, 2004
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Wednesday, April 7, 2004 |
| CVS purchase of Eckerd could change Fayette drugstore landscape By J. FRANK LYNCH P>National pharmacy chain CVS, which raised its profile of local stores to three with a recent opening in Tyrone, could be operating as many as 10 locations throughout Fayette County in a matter of weeks once it completes a buyout of rival Eckerd from J.C.Penney, announced Monday. Fayette County has six Eckerd stores now, counting the old Mundy’s Pharmacy in Tyrone, a town institution that changed hands in January when owner Louis Mundy retired. Eckerd had planned to relocate from Mundy’s old storefront on Senoia Road to a new building at Hwy. 74 and Dogwood Trail. Another Eckerd location is already under construction in south Peachtree City near Starr’s Mill. It was uncertain Monday what the future of those stores would be. The transaction will give CVS 1,260 Eckerd locations, mainly in the Southeast. Pending approval, the deal also includes another 1,540 Eckerds sold to Jean Coutu Group, a Canadian retailer that services the Northeast. The $4.5 billion sale will erase the long-familiar Eckerd name, but solidify CVS as the nation’s largest drug chain at least in numbers of locations with more than 5,000, according to the Associated Press. Walgreen’s claims to be the nation’s largest in total volume of sales, according to reports on the Internet. Walgreen’s, which expanded into the Atlanta market within the past five years, has just two local stores, both in Fayetteville. The two area CVS stores, however, are located away from any Eckerd stores, which could convince CVS to change out the name and retrofit the old stores, but otherwise leave them in business. That would be good for Fayetteville in particular, which has suffered “big box blight” in recent years as national chains are closed, bought out or relocated. In acquiring the Fayette Eckerd stores, CVS will find itself sitting at some of Fayette County’s prime retail locations. In Fayetteville, CVS is on Ga. Highway 85 North at Ga. Highway 92, next to Wendy’s, while the nearest Eckerd stores are at least a mile in any direction — on Hwy. 85 at Banks Road, Hwy. 85 South at Hwy. 92 South, and Ga. Highway 54 West at Gingercake Road. In Peachtree City, the lone CVS is at Lexington Circle, next to Buckhead Brewery. There are two free-standing Eckerd locations, about a mile away on Hwy. 54 at Peachtree Parkway next to Ruby Tuesday, and another still further on down Hwy. 54 at The Avenue. A third Eckerd is under construction on Peachtree City’s far south side at Wilshire Pavilion, the Publix-anchored retail center on Hwy. 74 South at Holly Grove Church Road. And the Mundy’s replacement in Tyrone, which had been recast as an Eckerd anyway, is in development on Hwy. 74 at Lancaster, John Wieland Homes’ mixed-use development that includes a Publix. Typically, retailers finish out new locations that are under construction when a large buyout occurs, opening as planned based on prior market research, or selling the building to another non-competitive business. For example, Revco had hundreds of millions of dollars invested in building dozens of free-standing stores all over Atlanta, when CVS bought out the chain in the mid-1990s. Occasionally, you still see an empty Revco that never opened up, but most were eventually adapted to other uses. For J.C.Penney, a mainstay in American retailing for more than 100 years, selling Eckerd will allow it to pay down debts, buy back stock and focus all its resources on continuing the steady growth of its 1,020 department stores, which have shown marked improvement in three years, according to reports on the Internet. Eckerd was the first of the national pharmacies to locate in Fayette County starting about 1980, with stores next to Big Star groceries in both Fayetteville and Peachtree City. Those locations remained until Eckerd replaced them with freestanding stores in the late1990s. Nationally, sales at Eckerd had remained stagnant or plummeted as Walgreen’s and CVS took hold of the profit-rich pharmaceutical segment of the business, according to reports Monday. The chairman of CVS estimated it would take two years to update and turn around all of Eckerd’s ailing stores — to the tune of $350,000 per location, the Associated Press reported. Walgreen’s said it would not veer from a prior business plan to add 450 stores nationwide this year, and another 3,000 by the year 2010. None of the Walgreen’s stores have been announced locally.
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