Drug Emporium: a highly disciplined HBA specialist

Drug Store News, Sept 30, 1991 by James Frederick

Drug Emporium: a highly disciplined HBA specialist

COLUMBUS, Ohio - Drug Emporium president Bob Lyons likes to describe the company's management philosophy as an "upside-down pyramid.

"The store is where the action is," he said recently. "We're decentralized - store managers make decisions."

Lyons' comments underscore the delicate decision-making balance required to run a successful off-price chain. That balance requires the right mix of centralized, standardized support and control over merchandising and marketing, with a strong dose of store-level autonomy and on-the-spot decision-making.

In the case of Drug Emporium, it means that store managers "make the quantity decisions in terms of purchasing," according to ceo Gary Wilber, while central buyer/merchandisers review categories and new items, plan strategies with vendors, maintain general merchandising standards and execute ad feature programs.

Both sides work to hone Drug Emporium's edge as one of the nation's top 10 retailers for most of the major manufacturers of HBA. Indeed, the chain bills itself as having "the nation's biggest selection of HBA." Selection in its stores bears out the claim.

In categories like eye care, hair care and pantyhose, in fact, Drug Emporium seeks nothing less than to overwhelm its competitors with selection. A case in point: stores carry roughly 220 eye care items alone, including a huge mix of cleansing and wetting solutions for contact lenses and specialized items for sensitive and sore eyes.

"Drug Emporium has been working hard to influence the customer mind-set," noted the company's most recent annual report. The goal: to position the stores as the specialist in HBA - from which the company derives more than 50 percent of its business - and related categories such as cosmetics/fragrances.

Rich Landers, vp-marketing and merchandising, explained it this way: "We market Drug Emporium. . . as the HBA specialist with deep-discount prices, providing customers with what they want, when they want it."

That focus on maintaining broad selections and remaining in-stock on HBA positions Drug Emporium differently from most off-price competitors who rely strictly on deal buys for a rotating mix. Indeed, founder Phil Wilber refers to the company as a "specialty drug store" that happens to maintain sharp everyday discounts.

Another crucial Drug Emporium difference: its stores route customers past a "What's Hot, What's New" aisle as they enter the store - hitting them with pallets of heavily advertised new "A" branded products in the first aisle.

To boost productivity, the chain has spent heavily over the past three years on new automation. Its effort have yielded a new pharmacy computer system and new computer systems in every store for managers.

PHOTO : Drug Emporium, one of the top 10 retailers for most major HBA manufacturers, derives

PHOTO : more than half its volume from HBA and seeks to overwhelm competition with assortments.