Pharmacy prescribes the connection

Drug Store News,  Dec 19, 2005  by James Frederick

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Pharmacy: It's the new popcorn.

Just as Sam Walton once used popcorn to connect to customers in the dime stores that sowed the seeds of the 3,800-plus-store chain, today pharmacy is Wal-Marts connection to the customers and communities it serves--and much more.

Pharmacy--health and wellness--is the connection to the rest of the Wal-Mart store, tying together so many other key specialty departments, from OTCs and health and beauty aids to food and sporting goods and even apparel and footwear.

Pharmacy lies at the heart of the one-stop shopping concept by which Wal-Mart defines convenience. "Wal-Mart should be viewed as a trusted source for quality products that provide both value and convenience, as well as information for our customers," said vice president of pharmacy Art Alderson.

"It's important for the customer to understand that there is both value and convenience at a Wal-Mart pharmacy. They have the convenience of one-stop shopping--not only do we provide everyday low price on prescription drugs, we have a staff of professional pharmacists," he said. "The community pharmacist has unique value in [the health care] supply chain, and that is counseling customers."

The Wal-Mart pharmacist, in many ways, is like a health ambassador to the rest of the store. The pharmacistpatient interchange can drive more traffic to more seemingly disparate departments than any other part of the store.

The customer battling heart disease or diabetes needs more than just his meds. In addition to the more obvious connections to such categories as OTCs and health and beauty care, supplements and skin care, among others, there are myriad other products. This customer needs advice on eating better, which probably will lead him to the food aisles. He needs someone to tell him the role exercise will play in helping manage his weight, which probably will take him to sporting goods for fitness equipment. Or, maybe this customer will stop by the DVD racks for an exercise video or by apparel for a warm-up suit and a pair of sneakers.

"A Wal-Mart pharmacy offers more than just the basics," Alderson explained. "It offers food, health and nutrition, exercise--it offers all these different areas that we are able to pull together. So, pharmacy becomes the driving factor, but it is also ancillary to all of our other departments--it's one-stop shopping."

In a nod to the importance of the pharmacist-customer connection, Wal-Mart currently is testing a new pharmacy prototype in two Texas stores that knocks down some of the walls and puts the pharmacist closer to the patient.

Pharmacy also represents an important connection to the future of Wal-Mart, and it will drive a significant amount of long-term growth for the company. Furthermore, it is clear that Wal-Mart will leverage its significant investments in technology, convenience and price to continue to evolve into more of a force in pharmacy--just as it has in so many other categories, such as food, OTC, electronics and health and beauty.

This year, Wal-Mart's more than 3,800 in-store pharmacies will churn up well over $10 billion in prescription sales alone to rank it among the top three retail pharmacy chains in the United States. Driving Wal-Mart into the upper ranks of traditional drug store retailing is a slew of factors, starting with its massive customerdrawing power in communities nationwide, its deep and still-growing personal attachment to the communities it serves, its growing arsenal of pharmacist-driven patient care services and its world-class retail and distribution systems. Add to this list the company's ability to leverage its supplier relationships for the lowest possible prices, not only on pharmaceuticals and over-the-counter medications, but also on key products throughout the store.

The relationships with its pharmaceutical suppliers also yield the kind of vendor support that can turn Wal-Mart's patient screening and educational efforts into full-blown health care events on a national scale. These events are perhaps the clearest illustration of Wal-Mart's connection to the communities it serves.

"Last month, we completed more than 500,000 flu shots over two days. It takes a lot of effort from the pharmacy, the whole company [and] our supplier partners," said pharmacy merchandise manager Bruce Painter. "We partner with our suppliers to help us bring these events to communities and with specialized companies that staff these screening events and provide materials to educate our pharmacists."

And, these events are bigger than just pharmacy. "It's a whole-store event--it's not just pharmacy," Painter explained. For instance, at a typical Healthy Heart event, in addition to cholesterol and blood pressure screenings in the pharmacy department, there may be a food company along the "action alley" doing a sampling for a new heart-healthy breakfast cereal or a supplement maker debuting a new fiber product.