Snyder's caps Drug Emporium integration in first hybrid store

Drug Store News, April 28, 2003 by James Frederick

BLOOMINGTON, Minn. -- In a boldly conceived blend of its traditional drug store and discount store formats, Snyder's Drug Stores/Drug Emporium unveiled a new hybrid store prototype here that offers its hometown customers more selection and lower prices without sacrificing convenience, health care service and ease of shopping.

The 15,000-square-foot store, which replaces a former Snyder's drug store, opened March 30 in this densely populated suburb of Minneapolis. It's the first to operate under the combined Snyder's/Drug Emporium logo and marks the company's first real marriage of its two distinct retail entities. "We've taken the ... promotional aspects of the Drug Emporium stores and the typical drug store merchandise mix of our Snyder's stores and blended them together," said Snyder's president and chief executive officer Gordon Barker.

The new concept was an immediate hit with the chain's hometown consumers, said John Greer, executive vice president and president of the company's discount store division. "Among all the stores we've opened in the last three years, it's growing at the fastest pace--especially at the front end," he said.

The new format marries the traditional but recently upgraded Snyder's neighborhood drug store with elements of the 77 Drug Emporium stores Snyder's parent company, Edmonton, Alberta-based Canadian drug store operator The Katz Group Canada, purchased in late 2001. Katz, which purchased Snyder's in 1999, has made no secret of its willingness to commit additional seed money to its U.S. growth ambitions, and Barker indicated that the new hybrid-store concept could be a new growth vehicle for the company.

Calling it a "good cross between the two [store] types, Barker said the store, at 15,000 square feet, is small enough to maintain the convenience and ease of shopping found at the chain's Snyder's drug stores, which average 12,000 square feet. But the new hybrid format also is big enough to allow for a racetrack perimeter aisle, a wide promotional/seasonal aisle, quadruple the number of grocery items found in a typical Snyder's store and twice the number of coolers for soft drinks and perishables found in the smaller drug stores. The Snyder's/Drug Emporium hybrid also features expanded cosmetics, toiletries, greeting cards and general merchandise at discounted prices.

"It's highly promotional like a Drug Emporium, but it's also a good format to work with where we can't open a typical, large-scale Drug Emporium store in the 25,000- to 30,000-squarefoot range," Barker explained.

The new concept store offers an enlarged and "more open" pharmacy area, according to company officials, along with a larger selection of general merchandise typically found in the company's Drug Emporium, F&M and Vix discount stores. Among its destination-center departments are cosmetics, personal hygiene, household cleaners, groceries and toys. Also featured is an extensive selection of live plants.

Prices on front-end merchandise are lower than typical drug store prices and similar to those offered in the company's discount stores, according to Barbara Miller, executive vice president of administration. Besides expanded GM, the store also offers a drive-through pharmacy, one-hour photo, Western Union, money orders, phone cards, fax machine and other services.

"The entire store has a new look and feel," Miller noted, "from its open, modem atmosphere to the large, curvilinear signs hanging over each department."

Buoyed by the rapid early acceptance of the new concept, the company already is close to opening a second Snyder's/Drug Emporium hybrid store, according to the chief executive. That store is due to open in late May, also in the Minneapolis/St. Paul region.

Snyder's, which now operates 158 traditional and discount drug stores, has converted the bulk of its supply chain to centralized distribution following the purchase last fall of a 700,000-square-foot distribution center.