As of October 2023, Rite Aid has closed 772 stores, more than a third of the approximately 2,000 locations the company operated before it went bankrupt.
Michigan and Ohio have been hit the hardest, with a whopping three out of four Rite Aids clinics in those two states now closed.
In the past month alone, the struggling drugstore has closed 189 stores in neighboring Midwest swing states, raising fears among locals that the chain is preparing to exit the area entirely.
After filing for Chapter 11 bankruptcy protection in October, Rite Aid announced it would initially close 154 underperforming stores in a dozen states. In the nine months since, it has closed another 618.
An analyst said ABC27 In September, the worst-case scenario was that 700 stores would close, a situation Rite Aid has far exceeded.
The chain is facing a number of challenges.
Drugstores generally have a hard time competing with large retail chains and with Amazon, which launched its own online pharmacy in 2020.
The most recent closures occurred last week, when Rite Aid announced it would gradually close 10 stores in Ohio and 20 stores in Michigan, court documents show.
In fact, 43 percent of all stores in Ohio and Michigan have closed so far, even though those states aren’t even Rite Aid’s biggest markets.
This has raised concerns among some that these two states could be left with one of the largest pharmacy deserts in the country.
A Rite Aid pharmacist told an Ohio business magazine last month that the recent series of closures “without a doubt” will cause enormous hardship for vulnerable populations who need a pharmacy nearby.
“Some of Rite Aid’s locations are in areas where there aren’t many competitors or other options,” he said. Crain’s Cleveland Company.
A major factor in Rite Aid’s ongoing bankruptcy is the company’s failure to settle hundreds of costly lawsuits accusing the company of overprescribing opioids.
But when Judge Michael Kaplan approved the company’s reorganization plan late last month, 16 of the 17 state lawsuits alleging negligence in opioid prescribing were settled.
The 22,000 people who filed opioid claims against Rite Aid are entitled to a $250 to $500 payment, Reuters reported.
The restructuring will also reduce debt by $2 billion, which will be financed primarily by a group of Rite Aid lenders.
It’s unclear when Rite Aid will emerge from bankruptcy, but the company plans to return with about 1,300 stores in total, a stark contrast from when in 2008 it operated 5,059 establishments.
Neil Saunders, CEO of GlobalData, told DailyMail.com that no one should expect Rite Aid to return to its 2008 level: the country’s third-largest drugstore chain.
“Rite Aid hopes to get back on solid financial footing, but the company will emerge from bankruptcy a much smaller company with far fewer stores,” Saunders said.
DailyMail.com has reached out to Rite Aid for comment but has not yet received a response.
Walgreens, the largest pharmacy in the U.S. after CVS, is struggling with its own financial problems and announced last month that it would close a “significant” number of its 8,700 U.S. stores.
When Rite Aid filed for bankruptcy protection last October, it announced it would initially close 154 underperforming store locations in more than a dozen states. In the past nine months, it has closed another 618
Three people browse the sparse shelves of a Brooklyn Rite Aid in August 2023, months before the company reportedly went bankrupt
A woman browses the shelves at a Rite Aid in Alhambra, California on October 18, 2023. The store was set to close within days of announcing bankruptcy on October 15.
Rite Aid was once the third largest drugstore chain in the country, with more than 5,000 locations in the U.S. After the bankruptcy, that number could drop to just 1,300
The widespread “retail apocalypse” that has seen brick-and-mortar stores grapple with rising theft and ever-tightening profit margins is certainly not limited to drugstores.
In late April, US retailers announced they would close nearly 2,600 stores by 2024.
Walmart, the largest retailer in the US, has closed 11 stores so far this year.
Earlier in April, dollar store 99 Cents Only said it would close all 371 of its stores, while Best Buy closed 10. in March.
Money tree close 1,000, Macy’s 150 – a third of the total – and drugstore Ritual aid 77.
In recent months there has been a series of bankruptcies, resulting in store closures, including that of home and furniture chain Conn’s.
National coffee and luxury supermarket chain Foxtrot also announced in early April that it would be closing all of its stores with immediate effect, leaving staff and customers stunned.
Express, a well-known mall-based retailer, filed for bankruptcy in April and said it would close 95 Express locations, in addition to all of its UpWest stores.
In early May, Rue21, the teen fashion chain that is a fixture in malls across America, also announced that it will close all of its 543 stores in the US.