And I think Amazon should buy them.
Drug stores have evolved from the time they first popped up and people love shopping there because its, convenient.
Pros
-Amazon is an online retailer with no real retail space yet. Their first stores weren't done right.
-Amazon already has an online medical clinic(One Medical) and pharmacy business that could be easily integrated together.
-Amazon with their analytics could easily stock each store and location with the right products from their online inventory making each store more profitable.
-Amazon has high shipping/delivery costs and growing each year. people are starting to have a package theft issue. Your local store can easily become a pick up spot of your packages, safely. Whole foods stores are very limited for pick up, same with pick up lockers.
-Would also be a good returns spot, no need for Kohls or UPS eating into costs.
-Could have bigger stores in some locations for a bigger variety of products and services. Kroger's has some grocery stores and some marketplace stores. Amazon is essentially a giant warehouse that has to ship everything to your doorstep.
-Amazon is launching a Shein and Temu competitor, stores could easily offer cheaper products in the right neighborhoods. What usually deters people from making a purchase is the shipping cost, nobody wants to order $35 of stuff just to avoid the shipping fee, plus tax.
-Walgreens
-more than 8,700 retail locations across the U.S.
-annual revenue for 2023 was $1451B, Amzn makes this in a quarter
(1) Pharmacy: $87B 60%
(2) Retail: $37B 26%
(3) Wholesale & Others:$20B 14%
-Walgreens owns Alliance Boots, a retail pharmacy/beauty store across the UK: https://www.boots-uk.com/about-boots-uk/our-purpose-and-values/our-stores/
-Boots owns The No7 Beauty Company: https://www.no7company.com/
-Most importantly Walgreens has ALOT if not most of their stores in busy high traffic areas making their locations valuable and offers convenience shopping.
Cons
-Walgreens has $32B in debt
-Might need regulatory approval but Whole Foods got approved so this shouldn't be much of a problem
-Will likely need to close some unprofitable stores and sell the land or transform them into something else
This deal makes more sense than Amazon buying Whole Foods, and they already have this retail experience. If Amazon doesn't make an offer i think a private equity company will take it private and turn the business around.
I like the stock. Amazons acquisition would revitalize the brand and bring new excitement if done right. Bought some shares because they are cheap and this is way over sold.
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