http://www.healthcaredive.com/news/cvs-health-to-cut-600-corporate-jobs-1/429798/
CVS Health employs more than 240,000 people in the U.S., many of whom work in retail positions or as pharmacists at its 9,600 pharmacies. But with increased competition in the drugstore retail space, CVS Health is starting to let some of those positions go.
Recently, the retailer has been buffeted by the likes of Walgreens, Rite Aid, and Wal-Mart Stores jockeying for sales of medications and health care services. Today’s drugstores compete with doctors and healthcare clinics as well as with retailers like Sephora and Ulta in beauty, and of course, general merchandisers like Target and, increasingly, Amazon, in consumer goods. The retailer may also be wary of the proposed merger between rivals Walgreens and Rite Aid.
An uptick in lower-priced generic pharmacy sales and a decline in store traffic muted CVS Health in its previous quarter. Sales grew 2.1% in Q2, missing analyst expectations for a 2.5% rise and trailing well behind the 4.2% increase that CVS posted in the first quarter of this year. Non-pharmacy same-store sales fell 2.5% in Q2, the company added. The drugstore retailer is due to release its third quarter results next week.
While the Affordable Care Act has expanded some opportunities for drugstore retailers to offer more medical services, the law has also helped lower some healthcare costs, as it was intended to do, which could hit retail sales. CVS also left a lot of money on the table when it ceased sales of tobacco products two years ago.
