INVENTORY

CVS Pharmacy in 2,900-store healthy food commitment

BY Michael Johnsen

CVS Pharmacy is upping its game on food.

The company on Tuesday unveiled plans to improve its convenient food offerings with healthier foods and beverages across more than 2,900 locations, up from an initial 500 pilot stores announced last year. Throughout the year, 100 stores each week are being enhanced with a carefully curated selection of national and niche better-for-you brands that make healthier eating on-the-go, convenient and affordable.

"Since becoming the first and only national pharmacy chain to end the sale of cigarettes and other tobacco products, the No. 1 thing we've heard from our customers is the desire for healthier food options," stated Judy Sansone, senior VP front store business. "This year, we are continuing to expand the assortment, volume and shelf space dedicated to better-for-you foods and snacks offered in our stores nationwide to make healthier snacking easier and more convenient for our customers."

In addition to the 2,900 stores, which will stock a wide assortment of healthy foods by year end, another 360 stores will receive significant additional enhancements to the layout of food, beauty and over the counter health products.

The new store layouts have a broader assortment of better-for-you foods in an expanded refrigerated section and more prominent displays of healthy foods and grab-and-go snacks, making healthy snacking more convenient.

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ECOMMERCE

How a Boston start-up is transforming alcohol sales for the digital age

BY CSA STAFF

Launched in 2013, Drizly facilitates the sale and delivery of alcoholic beverages online. Chain Store Age recently visited the company’s Boston-based headquarters and spoke with Nick Rellas, co-founder and CEO, about Drizly’s business model and the evolution of e-commerce.

What made you decide to enable the online sale and delivery of liquor?

It had little to do with delivery and more to do with the fact you couldn’t buy alcohol online with more prevalence. The whole world has gone digital in the last 15 years, from airline travel to books to apparel. We wondered why more rigid industries like alcohol hadn’t moved to digital.

How do you deal with the various state and federal regulations affecting alcohol?

It’s serendipitous we launched in Massachusetts, which has arguably the most restrictive alcohol regulations of any state in the country. It made us prepared. If we had started in a state with fewer regulations, we would have had a jaded perspective.

We embrace regulation — it works. Operating in a space with a controlled substance like alcohol, our job is to work within those regulations. The laws have some intricacies. Our job is to figure out how to operate within those confines. They’re there for a reason.

Why is there a need for third-party e-commerce facilitators like Drizly?

Looking at the way retail has unfolded online in the last 15 years, many retailers have had e-commerce sites, but not been that successful. The pricing for consumers and availability of delivery time is often not where it needs to be. In the case of liquor stores, they sell a very homogenous product which is often not very compelling on a singular store basis.

In the past 10 years, a lot of e-commerce expansion has been through marketplaces like Amazon and Wayfair. They do things a single e-commerce site doesn’t do, and act more like a technology company. Few retailers, even large public companies, are good at both retail and technology.

Can you briefly describe Drizly’s business model?

We provide customers an e-commerce experience. They see different prices and availability for products across different retail partners. The customer picks the store and price shops across time.This is actually a new feature we just started offering in the past four to six weeks, so it isn't exactly the entire model of the business. Typically, based on your location you are connected with your local liquor store that is within our retailer network to shop your favorite beer, wine and liquor with delivery to their door in less than an hour. With this new feature, we are allowing you to shop from multiple retailers based on their location to shop from the store/prices/time.

We don’t do deliveries. Our retail partners fulfill orders with their own employees. We operate like a cloud hosting company. I don’t think the economics of being a delivery company are very compelling. We don’t look at ourselves as a delivery company, but as an e-commerce company. It’s the disruption of the disruptors.

Does Drizly work with a lot of independent liquor stores?

We work with an equal amount of chains and independent stores. It varies by region. In the Northeast, you don’t usually see large chains. For example, in New York you can only hold one liquor license. In Florida, our partner ABC Fine Wine & Spirits has more than 250 stores. We’re also talking with some state liquor authorities that operate stores.

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POS/PAYMENTS

Costco flips the credit card switch

BY Marianne Wilson

The American Express card is now history at Costco Wholesale Club.

As of June 20, Costco is accepting only Visa-branded credit cards chain wide.

The retailer made headlines last year when it announced that, after 16 years, it was dropping American Express as its exclusive credit card provider and switching to Visa.

In line with the change. Costco has switched its store-branded credit card from the TrueEarnings Card from Costco and American Express to the new Costco Anywhere Visa Card by Citi. Similar to the TrueEarnings card, the new card will offer cash-back rewards redeemable at Costco. Some of the new card’s features include:

• 4% cash back rewards on eligible gas worldwide for the first $7,000 and then 1% after;

• 3% cash back rewards on restaurant and eligible travel purchases worldwide;

• 2% cash back rewards on all other purchases from Costco and Costco.com; and

• 1% cash back rewards on all other purchases.

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