Faris Lee Investments’ Post

Walking away from over $2 billion in annual revenue is no small feat. Yet, for CVS Pharmacy, they turned out to be quite all right... Their decision to have a ‘Leadership Funeral’ was an incredible win in all aspects. In February 2014, CVS made the bold move to discontinue selling tobacco products. The immediate hit to revenue was significant. But the long-term benefits far outweighed the short-term losses. Hiring and retaining talent became much easier, especially as millennials rallied behind the cause. And here’s the kicker: Despite the initial revenue loss, CVS saw their company-wide revenue more than double since 2014. This decision wasn't a financial strategy; it was a statement of values. CVS stuck to their values, prioritizing the health and well-being of their customers over short-term profits. This move resonated deeply with employees and customers alike, creating a stronger, more loyal community around the brand. So, what’s the takeaway here? 👉 Sticking to your values is crucial. It might seem daunting to make a big change, especially if it comes with an immediate cost. But when you align your actions with your core values, you create a foundation for long-term success and meaningful impact. Sometimes, the biggest wins come from making tough choices that reflect who you are and what you stand for.

To my Walgreens & CVS Pharmacy colleagues, In a conversation with a talented founder yesterday who is likely to close a deal soon with the US leader in retail NPS, he mentioned: “Walgreens and CVS’s core capabilities/advantages definitely include literally being in essentially all populated zip codes (aka neighborhoods) in the US.” Who else has that as a core advantage in the US? UPS. And UPS uses that core advantage to offer other services that have nothing to do with shipping (eg notary services, copy/print) and have everything to do with providing services in the neighborhood, VERY close by. What if the growth of the neighborhood pharmacy (core benefit = VERY conveniently close by), had little to do with healthcare, everything to do with health and appealed mostly to young women and young Moms as they are most often the ones caring for loved ones AND keeping people healthy, including themselves…??? THAT pharmacy would grow, in part because it would be an enjoyable in store or swing by experience that feels more like Tader Joe’s and less like a doctor’s office. See how Best Buy transformed from being commissioned selling to tech advice helping you figure out what you need (trusted source), coupled with price matching. Pharmacies have an opportunity to extend “trust and convenience” from the pharmacist alone to a whole store of conveniently available (aka ALWAYS in stock) products for healthy living.

CVS cut $2B in tobacco sales to align with their health principles. Sometimes principle-based decisions hurt before they help. Doing what's right comes with the cost but it leads to greater return in the end. February 2014, CVS Health announced it would cease tobacco sales, a move that initially led to a short-term decrease in its share price. However, by August 2014, the stock had risen approximately 20% from $66.11 to $79.45, outperforming competitors like Walgreens and Rite Aid during the same period. UCSF SMOKING CESSATION LEADERSHIP CENTER Two years after the announcement, the stock price had increased by 66%, indicating a positive long-term trend. INC. This suggests that, despite initial concerns, CVS's decision to end tobacco sales did not adversely affect its stock performance in the long run. https://lnkd.in/gEvwm6cX.

When a business operates in its zone of mastery, it knows the art of making strategic sacrifices. Like the US drugstore chain CVS. In September '14, CVS rebranded itself as CVS Health and committed to a new corporate purpose - ‘Helping people on their path to better health.’ As part of this mission, they vowed to stop all cigarette and tobacco sales. This was a well-thought-out strategic move with benefits across the board. 1) They not only made up for the sales loss through new health-aligned businesses, but they grew total business. 2) All that earned talk increased their brand preference. 3) The best part was that this was a bold move that the competition simply could not copy it! Zone of Mastery strategies are bold and have multiple moving parts. And if played well, they lead to concrete wins that last a lifetime. hashtag #performonks #zoneofmastery #straegicsacrifices

Can someone love a pharmacy? In 2014, CVS took a risk to more fully fulfill their stated mission statement: Helping people on their path to better health. They announced they would stop selling any tobacco related products in all of their stores. It would cost them $2 billion per year in lost revenue. There was no loud public demand to do so, no online campaign, or public pressure, or scandal. It was simply the right thing to do for their stated cause. Wall Street analysts panned the decision. (700 packs of cigarettes a week per store lost – not including ancillary sales.) But this is what actually happened: Total sales of cigarettes sold in states where there were CVS stores decreased. – They dropped by 1 percent for all retailers. Nicotine packets increased by 4 percent overall. CVS’s decision actually encouraged smokers to quit. (Shoppers just didn’t go elsewhere to buy cigarettes.) And it didn’t tank the company. Stock prices dropped 1 percent the day of the announcement- only to bounce back the very next day. 8 months after the plan was implemented, the stock hit double – a record high. (I finished Simon Sinek’s The Infinite Game in 2022 and my husband just read it and reminded me of this great story.)

When a business operates in its zone of mastery, it knows the art of making strategic sacrifices. Like the US drugstore chain CVS. In September '14, CVS rebranded itself as CVS Health and committed to a new corporate purpose - ‘Helping people on their path to better health.’ As part of this mission, they vowed to stop all cigarette and tobacco sales. This was a well-thought-out strategic move with benefits across the board. 1) They not only made up for the sales loss through new health-aligned businesses, but they grew total business. 2) All that earned talk increased their brand preference. 3) The best part was that this was a bold move that the competition simply could not copy! Zone of Mastery strategies are bold and have multiple moving parts. And if played well, they lead to concrete wins that last a lifetime. #performonks #zoneofmastery #straegicsacrifices

South Africa's Dis-Chem Pharmacies half-year profit grows 16.3% Dis-Chem in its interim financial results for the six months ended 31 August 2024 reported Group revenue growth of 9.6%. * Operating profit before interest and equity accounted earnings grew 17.5% to R1 billion  *Wholesale revenue grew by 10.1% to R15.1 billion, with sales to its retail stores still being the biggest contributor. *Retail revenue grew 7.1% to R16.7 billion, with comparable pharmacy store revenue growth at 4.8%. * Basic earnings per share also increased to 67.4 cents (+15.6%) * The group upped its interim dividend by 16.1% to 26.98 cents per share* During the six-month period for the group, a net six retail pharmacy stores were opened, which resulted in 274 retail pharmacy stores and 53 retail baby stores as of 31 August 2024. #job #network #growth #results

𝐈𝐬 𝐲𝐨𝐮𝐫 𝐥𝐨𝐜𝐚𝐥 𝐩𝐡𝐚𝐫𝐦𝐚𝐜𝐲 𝐚 𝐛𝐢𝐠 𝐜𝐡𝐚𝐢𝐧 𝐩𝐡𝐚𝐫𝐦𝐚𝐜𝐲? 𝐈𝐟 𝐬𝐨, 𝐲𝐨𝐮 𝐜𝐨𝐮𝐥𝐝 𝐛𝐞 𝐢𝐧 𝐭𝐫𝐨𝐮𝐛𝐥𝐞... CVS, the largest US chain, closed 244 stores between 2018 and 2020. In 2021, it announced plans to close 900 stores. Rite Aid filed for bankruptcy last year and will close up to 500 stores. Many patients will be losing their local pharmacy. Those living in rural areas are at a huge risk. Walgreens has said 25% of their stores are not profitable - which are more likely to close? Rural ones with fewer patients or the busiest stores in big cities. This is something patients need to consider. #pharmacynews #retailpharmacy #pharmacystaffing #communitypharmacy #cvs #walgreens

BOTH CBD and non-CBD #officemarkets are experiencing positive demand for the first time since January 2023, resulting in the vacancy rate tightening across more than half of the capital city CBDs. But Melbourne continues to languish, nudging closer to having almost 1 million sqm of vacant office space. #OfficeLeasing #CRE #commercialrealestate #commercialproperty

Interesting to watch the details emerge