Company Mission Statements Retail Drug Stores

CVS Posts Rise In Profits
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Drug Stores and Pharmacies are the retailers of prescription drugs, as well as a selection of over-the-counter medications, Health, Beauty & Wellness (HBW) products, consumer electronics, food, and other consumable goods. Some retail drug store and pharmacy brick-and-mortar retail locations also provide in-store health clinic services and photo processing services. The retail drug store and pharmacy segment of the U.S. retail industry include brick-and-mortar websites, Internet shopping websites, and mail-order companies, but does not include hospitals and clinics.

Mission Statements of Large Drug Store/Pharmacy Chains

Even though they are in the same retail niche selling the same types of products and services, the largest drug store and pharmacy chains in the U.S. each have a unique mission, vision, and values statements which are the driving force that defines their brand, employee culture, and customer experience.

These days, many of the largest retail outlets for prescription and over-the-counter drugs are not drug stores at all. Most of the major discount stores, grocery stores, hypermarkets, and warehouse stores are all fighting for consumer dollars spent on medications and health and wellness products. 

Why Sell Retail Drugs

The reason why grocery stores, hypermarkets, warehouses, and discount stores have added pharmacy services to their product offerings is that of the prescription drug retail sales that are generated each year by U.S. consumers. To any retailer with the eye on their bottom line, retail prescription drug statistics are hard to ignore.

Retail Chain Drug Stores and Pharmacies Stats By the Numbers

  • 2.9 billion - The number of prescriptions filled each year (source: NACDS)
  • 3.3 million - The number of individuals that work in 179,000 chains with pharmacies (source: NACDS)
  • 21,394 - The number of chains that operate pharmacies (source: NACDS)
  • 40,000 - The total number of retail locations selling prescription drugs
  • Drug Store and Pharmacy Segment Overview

The reason why so many retailers are crowding the traditional Drug Store and Pharmacy in the U.S. space is that the business of retailing drugs is big business.

The answer to why drug stores and pharmacies are such a significant part of the U.S. retail industry can be found in current consumption, pricing, and spending statistics from the drug industry itself. 

Prescription Drug Consumption in the U.S. By the Numbers

  • 48.7% - Percentage of U.S. consumers who have used at least one prescription drug in the last 30 days. 
  • 21.8% - Percentage of  U.S. consumers who have used three or more prescription drugs in the last 30 days. 
  • 10.7% - Percentage of  U.S. consumers who have used five or more prescription drugs in the last 30 days. 
  • $310 billion - The amount spent on medicine in the U.S. in 2015
  • $121 billion - The amount spent on specialty drugs in 2015 
  • 15% - The percentage that specialty drug spending increased between 2014 and 2015.
  • 12.4% - The percentage that branded medicines prices rose in 2015
  • 50% - The percentage that the price of medicines have risen between 2010-2015 

Independent Retail Drug Stores and Pharmacies

  • 8.5 – the percentage year-over-year increase in dollars spent on prescription drugs in 2015
  • 2,320 – the number of new prescription drugs that are in the late phases of the development pipeline (as of June 2016)
  • $287 – Total billions in annual revenue generated by the Pharmacy and Drug Store market, according (source: NAICS)
  • 2.3% - the annual growth rate of the Pharmacy and Drug Store market (source: NAICS)
  • 723,757 – The number of people employed by Pharmacies and Drug Stores as of Apri,l 2016
  • 27,266 – The number of businesses operating in the Pharmacy and Drug Store sector of the retail industry (as of April 2016)

Independent Drug Store and Pharmacy Retailing:

Looking at this data and considering the ubiquitous presence of the largest drug stores, hypermarkets, grocery stores, and retail warehouse chains in the U.S., it might seem logical to conclude that the big chains have driven independent drug store and pharmacy retailers out of business. Surprisingly, though, the Independents are holding their own.

As of June 2016, there were 22,814 Independent Drug Store Retailers in operation Excluding the non-drug store retailers who are selling drugs; the Independent Drug Stores are beating the largest drug store chains in a number of locations. 

And not only are Independent Drug Store location numbers beating the biggest retail chains, according to Consumer Reports, independent drug stores, and pharmacies are beating their giant competitors in other important ways as well. In a Consumer Reports survey, the majority of 33,000 customers surveyed thought that Independent Drug Stores and Pharmacies were better with these aspects of the customer experience:

  • Overall satisfaction
  • Speed and accuracy
  • Courtesy and helpfulness
  • Pharmacists' knowledge

Which Retailers Sell the Most Retail Prescription Drugs?

The biggest competition for the largest Pharmacy and Drug Store chains, however, doesn't come from brick-and-mortar retailers at all. "Mail pharmacies," which are suppliers of prescription medications delivered exclusively by mail, are dominant retail suppliers and formidable competitors for all retailers selling prescription drugs in a physical retail space.

U.S. Mail Order Pharmacy Statistics By the Numbers

  • $264.5 billion - The total sales generated by retail prescription drugs purchased digitally and delivered to customers
  • $14.3 billion - The total annual profit from prescription drug mail order
  • 1.4% - The percentage of growth rate in mail-order prescription drugs from 2010-2015

With all that retail prescription drug revenue, it seems like the average retail drug store wouldn't need to sell anything besides prescription drugs to be profitable. In fact, prescription drugs have a relatively low-profit margin compared to other Health, Beauty and Wellness products sold in all of the largest retail drug store chains. That's why the pharmacies in drug stores are getting smaller, and aisles of non-drug merchandise are getting larger. 

The 11 HBW Categories Providing More Than 85% of Total HBW Sales For Retail Drug Stores

  • Smoking Cessation
  • Hair Care
  • Health Supports / Compression Hosiery
  • Shaving and Grooming
  • Feminine Care
  • Weight Management / Nutritionals
  • Foot Care
  • Deodorant
  • Family Planning
  • Sun Care
  • Batteries / Film