Drugstore Chains Need Improved Vaccine Rollout

As states ramp up their vaccination efforts, drugstore chains like Walgreens are hoping for their own financial shot in the arm. The stores have seen lower-than-usual sales during the pandemic and are hoping vaccination-driven foot traffic helps change that.

Immunization season

As of March 31, Walgreens had administered 8+ million vaccine doses, and anticipates profiting from the program in the second half of the year.

• Walgreens hopes to administer 26 million–34 million doses this fiscal year.
• CVS Health, which had administered 3 million doses as of February 16, has the capacity to administer 20 million–25 million per month.

But...but...but: So far, any additional sales Walgreens has rung up via its vax efforts have been offset by other pandemic-driven factors. A combination of fewer cold and flu cases and less foot traffic has stymied sales across the drugstore segment. Rite Aid’s over-the-counter sales during winter’s flu season plummeted 37%, for example.

• Until the vaccine becomes readily available to more customers, drugstores are unlikely to see the vaccine-driven sales bump they’ve been hoping for.

Zoom out: Walgreens and Co. aren’t banking on increased vaccinations alone to rebound. Other plans include creating an omnichannel tech platform (Walgreens), a new diabetes program (CVS), and ad networks (both, plus Rite Aid).