Rite Aid is making headlines for locking up almost all of its items in a Southern California store. … [+]
Ritehulp is making headlines for locking up almost everything in a Southern California store, keeping everything from baby food and paper towels to makeup and potato chips behind plexiglass.
The drugstore chain, which emerged from federal bankruptcy protection earlier this month, took steps at its Compton store that go beyond locking up higher-value items that require a drugstore employee to unlock a case. Rite Aid’s Compton store this summer began requiring customers to “call for help” by pressing a button that alerts an employee to unlock the encapsulated products in the store.
Rite Aid would not say whether the lockup on almost all items in stores will be repeated outside Southern Californiabut said it is part of a strategy to “test a range of product protection solutions across the company’s footprint to ensure goods are available to our customers.”
“At the same time, we are also exploring several mitigation measures to ensure our pharmacies can serve our communities without any disruption,” Rite Aid said in a statement. “We take an active role in assisting law enforcement in their pursuit of shoplifters, and continue our efforts to educate community leaders about the impact of shoplifting and advocate for solutions. We employ multi-layered product protection solutions that we continue to assess regularly, and we are committed to providing a safe environment for our employees and customers while supporting health needs in the communities we serve.”
Rite Aid, which eliminated $2 billion in debt earlier this month said it “has received approximately $2.5 billion in exit financing to support the company going forward,” operates in 16 states after losing more than 500 stores during bankruptcy proceedings. The drugstore chain, which had been losing money for several years, filed for bankruptcy protection in October last year. At the time, the company operated more than 2,200 drugstores in 17 states.
Some see Rite Aid’s anti-theft efforts as ‘extreme’ but drugstore chains, including rivals CVS Health and Walgreens, are facing tough decisions to close underperforming stores and theft, and costs to the companies are a factor in these moves.
Walgreens, for example, announced in June that it was completing a “footprint optimization program” to close certain underperforming stores across the company’s more than 8,600 U.S. locations. Manmohan Mahajan, Walgreens Executive Vice President and Global Chief Financial Officer said “25% is the total footprint” executives are evaluating for a possible closure. While there are many reasons why Walgreens stores are underperforming, business insiders and analysts who follow the company say shoplifting certainly plays a role in the stores’ underperformance.
“Retail crime remains one of the biggest challenges facing our industry today. We are focused on the safety of our patients, customers and team members and have taken a number of steps to help reduce organized retail theft in our stores,” Walgreens said in a statement. “We also continue to work with others in the retail industry, as well as law enforcement, elected officials and community leaders, to improve shrink trends.”