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Cvs Pharmacy Locations

As CVS chairman, president and chief executive officer Tom Ryan has noted frequently, pharmacy is what defines CVS. "It is who we are," he has said on several occasions. So it is not surprising that as the company has embarked on its quest to become the fastest and easiest drug store chain for its customers to shop, as well as for its own people to operate, the road begins at the back bench. What are quite arguably the chain's most important strategic initiatives right now revolve around improving service and efficiency in pharmacy.

In late July, Ryan unveiled Pharmacy Service Initiative, or PSI, which set about further reconfiguring the work flow in its pharmacy operation, picking up, essentially, where EPIC (read: Excellence in Pharmacy Innovation and Care) left off. PSI provides enhanced patient-pharmacist interaction, shifting as much of the busy work to its pharmacy technicians as possible under state laws.

Most notably, PSI includes new wrinkles in CVS' in-store pharmacy systems that enable its pharmacy staff to adjudicate prescription claims within three minutes--about the time it takes to order a burger and fries at a typical fast food drive-through window--while the customer is still in the store. This not only eliminates problem prescription transactions from tying up CVS' pharmacy systems, it also helps manage customer expectations by identifying problems for customers within an acceptable amount of time--before they return to pick up their script--because by that time their expectation is that it will be ready.

The work-flow enhancements under PSI include the creation of a special window at the pharmacy counter for dropping off prescriptions. During an early September visit to CVS' new, mammoth 19,000-square-foot store in Wakefield, R.I., Drug Store News observed a sign near the pharmacist consultation counter informing customers of CVS' commitment to enhancing pharmacy service, indicating that the new experimental store was an early recipient of the PSI enhancements.

By mid-summer, CVS had implemented PSI into some 1,200 of its stores, with plans to have it rolled out into all stores by the end of the year--which in itself is a pretty good indication of the early results it has achieved from the improvements it entails. Besides just identifying problems, though, PSI has reduced significantly the number of customer transactions that run longer than three minutes. "In stores where it has been implemented, we have experienced dramatic increases in service levels," Ryan noted in a July 30 analyst call.

Perhaps the second-most critical item on its strategic agenda is the continued rollout of CVS Assisted Inventory Management, or AIM system, for pharmacy. The micromerchandising/inventory management system had reduced inventory costs significantly and had helped eliminate out-of-stocks in the 3,800 CVS pharmacy departments that had been wired to its AIM system by mid-summer. Ryan noted that the chain expected to have completed the AIM-Rx rollout to all its stores by the end of the third quarter. (For more details, see the overview story on page 36.)

Aside from the changes the chain continues to make to mold its stores into a more efficient and more productive health care operation--some of which can be a bit subtle to the consumer--CVS also has taken some strides to enrich the experience of shopping for health care items. In the pharmacy department at CVS new Wakefield store, for instance, the waiting area features a large-screen, in-wall plasma TV, which, for the pharmacy customer, can make the time spent waiting to pick up a prescription seem to move a bit faster.

This fall, the chain plans to revamp its Beautiful You program--formerly known as CVS Beauty Days. Originally an initiative generally focused on moving beauty/personal care products, the program now will focus more on the health care-related aspects of a woman's beauty regimen, tying into more of the chain's OTC categories than before.

Mindful of the moms shopping CVS, the chain has created a dedicated children's nonprescription medicine set--pulling children's cough-cold and analgesics into a quick-stop destination center for kids' OTCs. In early September, CVS' new Wakefield store was showing a 4-foot in-line set divided into such segments as "For Runny Noses" and "Fever Reducers," with signage presented in a font chosen to mimic a child's handwriting. Given the fact that Wakefield represents one out of roughly 800 or so 24-hour pharmacy locations that CVS operates, experimenting with a kid's OTC section makes a lot of sense. Research has indicated that in the middle of the night, many parents choose the advice of the pharmacist over navigating their pediatricians' answering services in search of a solution. The 24-hour pharmacy enables this kind of access--a key reason why so many chains, including CVS, have made growing 24-hour locations a priority.

Another major focus for CVS on the OTC/health care side of its business has been a commitment to being first with new products. When CVS became the first drug chain to offer OTC loratadine, it made a big deal about it in its circulars, tying purchases to its ExtraCare card. CVS has found the investment in its ExtraCare loyalty card program to be a most lucrative one, providing many of its vendors with a good reason either to give CVS new products first or at least to provide the chain with a sweeter deal for its circulars than its competitors. In this capacity, even if it can't be first to market with a specific product, CVS has been able to drive more than its fair share of the business on new product launches--even double in some cases, such as the blockbuster launch of Procter & Gamble's ThermaCare.

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