The Pharm bullish on pharmacy

Drug Store News,  August 18, 2003  

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GRAND RAPIDS, Mich. -- The Pharm Deep Discount Drug Stores, a 21-store drug chain owned by Spartan Stores, is making a name for itself in pharmacy.

"It is mind boggling to see the, kind of performance that we do get in our pharmacies, Craig Sturken, Spartan Stores president and chief executive officer, told analysts during a July 30 conference call to discuss first quarter results. We enjoy the No. 1 position in pharmacy sales in the Toledo [Ohio] market."

Sturken did not provide detailed figures on its pharmacy sales, but did say that the chain, which operates in Ohio and Michigan, enjoys positive comps each week and "occasionally we see something that may approach double digits."

The company is counting on the continuation of that positive sales trend given that it recently invested $75,000 to $100,000 in each The Pharm unit to do what Sturken called "a paint up, clean up and fix up.

"We are very encouraged by the feedback that we have gotten on that investment and the sales trends," Sturken said.

Spartan Stores added The Pharm units to its portfolio when it acquired Seaway Food Town in 2000.

The Pharm, which also is located at www.thepharm.com, prides itself in offering shoppers everyday discount prices, including 60 percent off sunglasses and 50 percent off reading glasses every day. The drug store also offers up to 30 percent off national cosmetics brands. In addition, the company offers DVD, VHS and video game rentals at about 15 of its 21 locations.

The investment in its drug stores, along with other initiatives at the company, appear to be paying off as Spartan Stores narrowed its first-quarter loss to $6.1 million, or a loss of 31 cents per share, compared with a loss of $43.8 million, or $2.21 per share, in the year-ago period. Total sales rose 2.3 percent to $502 million. Retail sales increased 4.1 percent to $212.3 million, while same-store sales rose 0.7 percent.

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