In Recession CVS Seems Better Positioned Than Walgreen

Retailers CVS Caremark Corporation (NYSE: CVS) and Walgreen Co. (NYSE: WAG) both experienced lower sales in January compared with December numbers.

January saw the average monthly spending among Geezeo users fall 18% at Walgreen stores, compared to only a 4.92% decrease at rival CVS. Looking at the 3-month and 12-month trends for these two firms may shed some light on this fact.

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CVS customers averaged spending $53.35 throughout the month of January, an amount up 17.22% from October and 16.47% from January ‘08 figures, respectively. CVS’ good fortune has not been mirrored at Walgreen locations, suggesting that January’s declines are indicative of a more serious problem.

The average customer to shop at the chain spent nearly 10% less over the month than over the same period last year. The last quarter has also seen declines at Walgreen stores, with customers spending 1.24% less compared with October. Looking at these facts side-by-side, CVS appears to be better positioned to handle the economic recession, than its cross-town rival, so expect the firm to keep setting the pace.

This data was compiled by the Geezeo Main Street Spending Index (MSSI).

Comments

[PastTense:]

I, personally, and I think a growing number of other people virtually never frequent chain drugstores--instead we get those drug/health care supplies and the other merchandise that drug stores sell either at Walmart or the newer format supermarkets--which includes a drug store within it--for reasons of cost savings and convenience (one stop shopping).

So I question the long term prospects of chain drugstores--I see an eroding market share.

Feb 11 03:01 AM

[teriyaki:]

What the hell is a Geezeo and why should I trust their data?

Feb 11 04:04 AM

[long term w...:]

Wag pays a higher dividend than cvs, and there debt is much less than cvs, I wouldn' t trade my wag for cvs.

Feb 11 02:12 PM

[schade:]

PastTense - That is an interesting observation, has the Wal-Mart era brought the death of chain drug stores. In my town at least, there's two of each CVS/Walgreen representations within 5 minutes, don't even know where the closest Wal-Mart is. So I think for the time being chains will survive, but you're right in saying the paradigm has shifted.

Feb 13 09:50 AM

[User 356658:]

What is with the "cross town" rival? Their headquarters are about 800 miles apart..............are there no "geezeos" in Rhode Island?

Feb 13 02:27 PM

[Danbert:]

Because when people go into a CVS store, they have a great experience, great customer service and PEOPLE WORKING IN THE DEPARTMENT THAT THEY ARE SUPPOSE TOO!

AS for Walgreens, You have this INANE POLICY CALLED YOU WORK FOR THE COMPANY where Pharamcy Tech are working at the front Register and Photo Lab Speicalist working in Cosmetics. ON TOP OF THAT, you got rude people working the front register, very rude store managers who use racial slurs and foul language and EXTERMELY RUDE DISTRICT MANAGERS that tell customer it's none of their business as to why the Photo Lab Specialist is working in Cosmetics.

Plus Walgreens tries to break the rules, had 2 federal lawsuits and so much bad press

Feb 15 12:55 PM

[User 357692:]

I would be very interested in what part of the country you live in. I work for WAG and have never seen this "cross department" scenario you speak of. We have a CVS less than a block from our store, and we hear of this going on at the CVS store. We are shocked because we are required to stay in our departments.


On Feb 15 12:55 PM Danbert wrote:

> Because when people go into a CVS store, they have a great experience,
> great customer service and PEOPLE WORKING IN THE DEPARTMENT THAT
> THEY ARE SUPPOSE TOO!
>
> AS for Walgreens, You have this INANE POLICY CALLED YOU WORK FOR
> THE COMPANY where Pharamcy Tech are working at the front Register
> and Photo Lab Speicalist working in Cosmetics. ON TOP OF THAT, you
> got rude people working the front register, very rude store managers
> who use racial slurs and foul language and EXTERMELY RUDE DISTRICT
> MANAGERS that tell customer it's none of their business as to why
> the Photo Lab Specialist is working in Cosmetics.
>
> Plus Walgreens tries to break the rules, had 2 federal lawsuits and
> so much bad press

Feb 16 01:32 AM

[User 360124:]

Could it be that the times are changing so much that the customers have lost sight of what it takes to run a retail store in a very much struggling economy?
It is very difficult to help customers that think they can run a business from their own home or from a computer, very much like an "armchair quarterback", you think you can do a better job yourself, but you really don't know anything about the business or game unless you grew up with it. Thinking they can make a difference in the stores if they just complain. Which in some cases will make the business worse and lower morale if they are just petty complaints i.e. "the cashier was missing a button on their shirt", "the cashier didn't give me a bag for my milk" or "I had a photo person helping me in the cosmetics dept". GROW UP PEOPLE! At least you got help in the dept. If trying to maintain a business by cross training employees to help lower payroll costs or keep morale at a positive level is a bad thing in some people's eyes, then maybe those people should open their own eyes to see the big picture. Maybe you came into the store when they were training a new pharmacy tech so that they can learn and understand the cash register before heading back to the pharmacy. And could it possibly be that the photo person could have been giving the cosmetician a lunch break and the manager was covering photo? But that is probably beyond your comprehension.
Walgreen's may come across as a greedy company, but they do care about the people that work for them and about the loyal customers that shop their stores. It's the coupon savings angels, inventory hording customers, that in some cases give Walgreen stores a bad rap, because rightly so, the store does not want to deal with this type of customer that constantly takes most of the inventory and leaves nothing for the next customer in line. These are the "cutthroat customers" that don't care about anyone but themselves. This is one reason why cashiers and managers are sometimes on the defense. People don't understand that on average Walgreen's and CVS stores see over 1000 customers per day. The front cashier that is making a very low wage has to endure the constant verbal beating from customers that come into the stores with a bad attitude and feel that they have to sometimes take it out on the clerks or managers. Although some instances is the stores fault and are HUMAN mistakes, we are not robots...yet. No customer knows how many verbal beatings that cashier has taken before they just explode or just shut down mentally. Customers need to think twice before they go into any retail store with an attitude if they expect to get good service. So get over it and quit being so narrow minded about how you think that Walgreen's is worse than CVS. Learn the "ins and outs" of what it takes to run a business before you go and spout off negative remarks on a subject that you clearly do not have any idea about!

Feb 19 11:17 AM

[WAG MAN.:]

Sounds like Danbert may have been fired from Walgreens for not meeting the standards.
If you were of any stature, you would be sued for libel.

P.S. glad to see you got that job at CVS.


On Feb 15 12:55 PM Danbert wrote:

> Because when people go into a CVS store, they have a great experience,
> great customer service and PEOPLE WORKING IN THE DEPARTMENT THAT
> THEY ARE SUPPOSE TOO!
>
> AS for Walgreens, You have this INANE POLICY CALLED YOU WORK FOR
> THE COMPANY where Pharamcy Tech are working at the front Register
> and Photo Lab Speicalist working in Cosmetics. ON TOP OF THAT, you
> got rude people working the front register, very rude store managers
> who use racial slurs and foul language and EXTERMELY RUDE DISTRICT
> MANAGERS that tell customer it's none of their business as to why
> the Photo Lab Specialist is working in Cosmetics.
>
> Plus Walgreens tries to break the rules, had 2 federal lawsuits and
> so much bad press

Feb 20 01:08 PM

[Fastiroll:]

CVS released figures showing a 17% sales increase. They apparently did not mention the change in fiscal years. It isn't aples to apples. Any investor that puts money in a company that would do that is taking a major risk. It is amazing that the SEC hasn't at the very least demanded a re-publishing of these numbers. Seems a little like FRAUD.

Feb 20 04:40 PM

[apharmtech:]

the customers at CVS are probably buying beer to drown their sorrows..wag doesn't sell beer...;-)

Mar 11 10:40 PM

[docdepharm:]

wow, sounds like a jaded ex-WAG employee to me!


On Feb 15 12:55 PM Danbert wrote:

> Because when people go into a CVS store, they have a great experience,
> great customer service and PEOPLE WORKING IN THE DEPARTMENT THAT
> THEY ARE SUPPOSE TOO!
>
> AS for Walgreens, You have this INANE POLICY CALLED YOU WORK FOR
> THE COMPANY where Pharamcy Tech are working at the front Register
> and Photo Lab Speicalist working in Cosmetics. ON TOP OF THAT, you
> got rude people working the front register, very rude store managers
> who use racial slurs and foul language and EXTERMELY RUDE DISTRICT
> MANAGERS that tell customer it's none of their business as to why
> the Photo Lab Specialist is working in Cosmetics.
>
> Plus Walgreens tries to break the rules, had 2 federal lawsuits and
> so much bad press

Mar 16 09:52 AM

[wag manager:]

Couldnt have said it better myself.


On Feb 19 11:17 AM User 360124 wrote:

> Could it be that the times are changing so much that the customers
> have lost sight of what it takes to run a retail store in a very
> much struggling economy?
> It is very difficult to help customers that think they can run a
> business from their own home or from a computer, very much like an
> "armchair quarterback", you think you can do a better job yourself,
> but you really don't know anything about the business or game unless
> you grew up with it. Thinking they can make a difference in the stores
> if they just complain. Which in some cases will make the business
> worse and lower morale if they are just petty complaints i.e. "the
> cashier was missing a button on their shirt", "the cashier didn't
> give me a bag for my milk" or "I had a photo person helping me in
> the cosmetics dept". GROW UP PEOPLE! At least you got help in the
> dept. If trying to maintain a business by cross training employees
> to help lower payroll costs or keep morale at a positive level is
> a bad thing in some people's eyes, then maybe those people should
> open their own eyes to see the big picture. Maybe you came into the
> store when they were training a new pharmacy tech so that they can
> learn and understand the cash register before heading back to the
> pharmacy. And could it possibly be that the photo person could have
> been giving the cosmetician a lunch break and the manager was covering
> photo? But that is probably beyond your comprehension.
> Walgreen's may come across as a greedy company, but they do care
> about the people that work for them and about the loyal customers
> that shop their stores. It's the coupon savings angels, inventory
> hording customers, that in some cases give Walgreen stores a bad
> rap, because rightly so, the store does not want to deal with this
> type of customer that constantly takes most of the inventory and
> leaves nothing for the next customer in line. These are the "cutthroat
> customers" that don't care about anyone but themselves. This is one
> reason why cashiers and managers are sometimes on the defense. People
> don't understand that on average Walgreen's and CVS stores see over
> 1000 customers per day. The front cashier that is making a very low
> wage has to endure the constant verbal beating from customers that
> come into the stores with a bad attitude and feel that they have
> to sometimes take it out on the clerks or managers. Although some
> instances is the stores fault and are HUMAN mistakes, we are not
> robots...yet. No customer knows how many verbal beatings that cashier
> has taken before they just explode or just shut down mentally. Customers
> need to think twice before they go into any retail store with an
> attitude if they expect to get good service. So get over it and quit
> being so narrow minded about how you think that Walgreen's is worse
> than CVS. Learn the "ins and outs" of what it takes to run a business
> before you go and spout off negative remarks on a subject that you
> clearly do not have any idea about!

Mar 23 10:26 AM

[Mr.BigGreen:]

I agree with this statment, i am so sick and tired of hearing people complain. I work in retail, and this is one place if you want to learn how to hate people, work in retail. These people who always complain about everything in the store, are the ones ruining everything for every oneelse. I think they just look at like since they are miserable, everyone should be miserable. And these are always the people who have never worked in retail, or finding some way to rip some one off. So stop crying and bitching about services from a business, and try running one urself.


On Feb 19 11:17 AM User 360124 wrote:

> Could it be that the times are changing so much that the customers
> have lost sight of what it takes to run a retail store in a very
> much struggling economy?
> It is very difficult to help customers that think they can run a
> business from their own home or from a computer, very much like an
> "armchair quarterback", you think you can do a better job yourself,
> but you really don't know anything about the business or game unless
> you grew up with it. Thinking they can make a difference in the stores
> if they just complain. Which in some cases will make the business
> worse and lower morale if they are just petty complaints i.e. "the
> cashier was missing a button on their shirt", "the cashier didn't
> give me a bag for my milk" or "I had a photo person helping me in
> the cosmetics dept". GROW UP PEOPLE! At least you got help in the
> dept. If trying to maintain a business by cross training employees
> to help lower payroll costs or keep morale at a positive level is
> a bad thing in some people's eyes, then maybe those people should
> open their own eyes to see the big picture. Maybe you came into the
> store when they were training a new pharmacy tech so that they can
> learn and understand the cash register before heading back to the
> pharmacy. And could it possibly be that the photo person could have
> been giving the cosmetician a lunch break and the manager was covering
> photo? But that is probably beyond your comprehension.
> Walgreen's may come across as a greedy company, but they do care
> about the people that work for them and about the loyal customers
> that shop their stores. It's the coupon savings angels, inventory
> hording customers, that in some cases give Walgreen stores a bad
> rap, because rightly so, the store does not want to deal with this
> type of customer that constantly takes most of the inventory and
> leaves nothing for the next customer in line. These are the "cutthroat
> customers" that don't care about anyone but themselves. This is one
> reason why cashiers and managers are sometimes on the defense. People
> don't understand that on average Walgreen's and CVS stores see over
> 1000 customers per day. The front cashier that is making a very low
> wage has to endure the constant verbal beating from customers that
> come into the stores with a bad attitude and feel that they have
> to sometimes take it out on the clerks or managers. Although some
> instances is the stores fault and are HUMAN mistakes, we are not
> robots...yet. No customer knows how many verbal beatings that cashier
> has taken before they just explode or just shut down mentally. Customers
> need to think twice before they go into any retail store with an
> attitude if they expect to get good service. So get over it and quit
> being so narrow minded about how you think that Walgreen's is worse
> than CVS. Learn the "ins and outs" of what it takes to run a business
> before you go and spout off negative remarks on a subject that you
> clearly do not have any idea about!

Jul 31 05:09 PM