Rite Aid has dramatically reduced its presence, particularly in the Midwest.
Almost all stores in Michigan and Ohio have been shuttered as the company severs ties with these states.
The Big Shutdown
Nationwide, Rite Aid has closed a staggering 856 stores since declaring bankruptcy in October 2023.
This number represents over 40% of its locations, a significant shrinkage in its operational footprint across the United States.
August Acceleration
In just the first week of August, 74 stores were closed, predominantly in Ohio and Michigan, with a couple in California and Washington.
This follows 169 closures in July, pinpointing a fast-paced exit from these key states.
Closing Countdown
With 95% of Michigan stores and 93% of Ohio stores now closed, the chain’s presence in these states is nearly erased.
The company is on a fast track to completely withdraw from these areas, with the process expected to conclude in just a few weeks due to the swift pace of closures.
Drastic Reduction from Previous Highs
Just under a year ago, Ohio and Michigan were among the states with the highest number of Rite Aid stores.
Now, there are merely a dozen left in each state, showcasing a dramatic decrease from their previous numbers.
Exceeding Initial Closure Estimates
Initially, Rite Aid announced it would close 154 stores, but over the subsequent nine months, it ended up shutting down an additional 702 locations.
An analyst had predicted a worst-case scenario of 700 closures, a number which Rite Aid has now surpassed, as reported by ABC27 in September.
Competition Drives Market Exit
Struggling against larger chains such as CVS and Walgreens, and facing competition from Amazon’s online pharmacy launched in 2020, Rite Aid is reallocating its resources to markets where it can maintain a competitive edge.
This means pulling out from areas where it cannot compete effectively.
Legal and Financial Troubles
Ongoing bankruptcy woes are compounded by numerous lawsuits alleging overprescription of opioids.
This legal battle illustrates the financial and ethical challenges facing the company amidst its restructuring efforts.
Projected Post-Bankruptcy Operations
“Rite Aid is hoping to get itself back onto a firm financial footing, although it will emerge from bankruptcy as a much smaller business with far fewer stores,” Neil Saunders, managing director of GlobalData, told The Daily Mail.
This reflects a strategic downsizing from the 5,059 locations it operated in 2008.
Sector-Wide Struggles
The broader retail sector, including giants like Walgreens, is also facing significant store closures.
This trend reflects a “retail apocalypse” where traditional stores battle against theft, online competition, and shrinking profits.
Economic Echoes
Nearly 2,600 stores have closed in the first four months of 2024 alone, with projections suggesting up to 8,000 closures by year-end.
The retail landscape is dramatically shifting, with even major players like Walmart and Best Buy downsizing.
Bankruptcy Bandwagon
Multiple retailers from varied sectors, including Dollar stores and fashion chains like Express and Rue21, are declaring bankruptcy and closing stores nationwide.
The cascade of closures highlights the ongoing challenges in the retail industry.
