Store closures have wreaked havoc on many companies over the past few years—and popular pharmacy chains have certainly not been spared in the retail apocalypse. Back in 2021, CVS announced plans to shutter 900 stores by the end of 2o24. Then, more recently, Walgreens revealed that it is planning to close 450 locations as well. Now, another major drugstore company may be climbing into the mix. Read on to discover why Rite Aid is reportedly closing almost 500 stores in the face of bankruptcy.
RELATED: 6 Banks, Including Wells Fargo and Bank of America, Closing Branches This Fall.
Rite Aid is planning to file for bankruptcy.
Rite Aid is currently searching for a way to overcome its clear struggles. The drugstore giant is battling more than $3.3 billion in debt and over 1,000 federal lawsuits, according to The Wall Street Journal. At the end of August, the news outlet reported that Rite Aid was already preparing to file for bankruptcy in the coming weeks to cover its debt load and pending legal allegations that it oversupplied prescription opioid painkillers.
A Chapter 11 bankruptcy filing would restructure the company's debt—which would include its current legal liabilities, CNN reported at the time. But Rite Aid told the news outlet in August that it "does not comment on rumors and speculation."
RELATED: Some Major Pharmacies Are Charging $190 for New COVID Shot—Here's Why.
Almost 500 stores may close as a result.
Rite Aid's bankruptcy plans are now moving forward, according to a new report from The Wall Street Journal. The news outlet reported on Sept. 22 that the company is currently negotiating with creditors over the terms of a plan that would include the liquidation of some stores, according to people familiar with the process.
One of the people told The Wall Street Journal that Rite Aid has proposed the idea of closing anywhere from 400 to 500 stores in bankruptcy. This would impact a substantial portion of the company's roughly 2,100 drugstores across the U.S., according to the news outlet.
RELATED: Walgreens and CVS Are Closing More Locations, Starting Tomorrow.
The company said nothing has been decided yet.
Best Life has reached out to Rite Aid about the potential closures, and we will update this story with their response. But in a comment to Forbes concerning the news, a spokesperson for the company confirmed that nothing has been decided yet.
"Given the conversations remain ongoing, no decisions have been made at this time, and we are focused on reaching an agreement with our financial stakeholders that will make Rite Aid stronger," the Rite Aid spokesperson told Forbes.
The people familiar with the bankruptcy talks told The Wall Street Journal that a group of bondholders are leaning towards liquidating a large number of stores, however. So while the two sides are still in discussions over the exact number, it is likely that a lot of locations will end up being shuttered either way.
But Rite Aid has already been closing stores for financial reasons.
This news comes as a number of Rite Aid stores have already shut down over the past few years. Back in 2022, the company reported that it planned to close 145 "unprofitable" locations in order to help "significantly reduce costs." Then, in July 2023, Rite Aid confirmed that it had just closed an additional 25 stores during its first quarter of the new fiscal year, Forbes reported.
Rite Aid executives also indicated at the time that they weren't ruling out more store closures as the company has continued to see financial losses, according to the news outlet. "We're constantly looking at performance of stores, particularly ones that don't have much lease life left on the lease and determining whether we've got an opportunity to continue to maximize the profitability and the efficiency of the fleet," Rite Aid CFO and executive vice president Matthew Schroeder told analysts during a July earnings call, per Forbes.
Schroeder added, "I would expect us to continue to do that. I don't have a number of store closures to give you, but it's certainly something we're going to continue to look at as we think about just how do we drive as much profitability as we can while still maintaining the presence in communities and providing access to our customers and communities."
RELATED:For more up-to-date information, sign up for our daily newsletter.
Kali Coleman Kali Coleman is a Senior Editor at Best Life. Her primary focus is covering news, where she often keeps readers informed on the ongoing COVID-19 pandemic and up-to-date on the latest retail closures.Read moreFiled UnderNews • RetailRead This NextSome Pharmacies Charging $190 for COVID Shot
There are some issues with the rollout of the latest boosters.September 21, 2023Walgreens and CVS Are Closing More Locations
The two pharmacy chains are continuing with mass shutdowns.August 15, 2023Walgreens Is Closing 450 Locations
The drugstore chain is preparing to pare down despite increased sales.July 3, 2023The Smart Man's Guide to Spotting Counterfeit Wine
That $2,000 bottle of Bourdeaux might be worth $20. Here’s how to be sure it’s the real thing.April 13, 2017The 5 Best Light-Bodied Red Wines for Extending Your Summer
Don't let September ruin a killer party. August 25, 201717 Insanely Cool New Luxury Bicycles for Spring
Meet the bikes that cost more than a car.March 31, 2017Best Life Essentials
You deserve the best. Live life to the fullest with these ultimate essentials.October 21, 2016This Is the Safest Way to Store Meat
Don't let that filet set you up for food poisoning. February 7, 2018Here Are the 10 Wealthiest Cryptocurrency Millionaires Under 40
Including one guy who is only 24 years-old!February 7, 2018This Is the Safest Way to Clean Your Floors
Keep your floors clean and looking brand new with this easy tip. February 8, 2018
