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Eckerd Corporation

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Eckerd Corporation
Company typePrivate (1898–1961)
Public (1961–1997)
Subsidiary (1997–2007)
NYSE: ECK (1961–1997)
IndustryRetail
Founded1898; 126 years ago (1898)
Erie, Pennsylvania, U.S.
Defunct2007; 17 years ago (2007)
FateAcquired by Rite Aid
SuccessorRite Aid
CVS Pharmacy
HeadquartersLargo, Florida, U.S. (as Eckerd)
Warwick, Rhode Island, U.S. (under Jean Coutu)
Products
ParentJCPenney (1996–2004)
Jean Coutu Group (2004–2007)
Websiteeckerd.com (2006 archive)

Eckerd Corporation was an American pharmacy retail chain that was headquartered in Largo, Florida,[1] and toward the end of its life, in Warwick, Rhode Island.[2] At its peak, Eckerd was the second-largest pharmacy chain in the United States, with approximately 2,802 stores in 23 states as far west as Arizona.

An independent chain for most of its existence, Eckerd was purchased by JCPenney in 1996. Following years of losses and failed attempts to turn around the company, the chain was divided in 2004, with 1,271 of its stores, and its mail-order business, sold to competitor CVS, and the remainder acquired by Jean Coutu Group.[3] Jean Coutu sold the chain to Rite Aid in 2007, and its name was phased out soon thereafter.

History

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Eckerd was founded in September 1898 (making it the oldest of the "big four" drugstore chains), by 27-year-old Joseph Milton Eckerd and Z. Tatom in Erie, Pennsylvania. In the company's early years, it operated at 1105 State Street in downtown Erie as the Erie Cut-Rate Medicine Store. In 1912, Eckerd and Tatom sold their original store to Eckerd's sons and moved to Wilmington, Delaware, establishing a new store. From Delaware, the chain expanded to North Carolina and later Florida.[4] Jack Eckerd, son of the founder, was responsible for the expansion of the company when he acquired three stores in Florida in 1952.

In 1961, Eckerd changed from a proprietorship to a publicly owned company. At the height of Eckerd's success, it had over 2,800 stores in more than 20 states, including 1,600 stores with Eckerd Express Photo one-hour photo labs in 19 states, and revenue of $13.1 billion (~$22 billion in 2023) in fiscal year 2000. Between 1968 and 1985, Eckerd owned Eckerd's Apparel and J. Byrons department stores, as well as VideoConcepts, a chain of mall-based electronics shops. J. Byrons and VideoConcepts were sold off in 1985, the latter to Tandy Corporation.[5]

JCPenney era

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JCPenney and Eckerd agreed to merge in November 1996, and the merger took place in 1997.[6] Penney paid $3.3-billion and assumed $760 million in debt to acquire Eckerd, and combined it with its 800-store Thrift Drug chain.[7] Under the agreement, all of JCPenney's Thrift Drug unit of drug stores (comprising Thrift Drug, Kerr Drugs, Fay's Drugs, and some Rite Aid stores) were rebranded to the Eckerd name. JCPenney Catalog Centers were added to Eckerd stores. JCPenney also bought more than 500 more stores from four other chains in New York state, Virginia and the Carolinas, such as the 1998 acquisition of the 141-store Genovese chain in the New York metropolitan area.[8] These stores were renamed in 2003.[9]

During this period, Eckerd became the second largest drug store chain in the U.S., with over 2,800 stores stretching from New York and Connecticut to Florida and west to Arizona. One carryover from the Thrift Drug days after the merger took over was the presence of JCPenney Catalog Centers inside certain locations, which enabled Eckerd customers to order merchandise from store catalogs and pick it up at an Eckerd location. As technology, such as ordering over the Internet, began to gain traction, Eckerd fell behind by failing to update its IT networks.[citation needed] Over the next seven years JCPenney came to see Eckerd as a distraction which would cost too much to continue fixing (as they were focused on their department stores), and in March 2004 it formally declared that it would carry Eckerd on its books as a discontinued asset. JCPenney took a $1.3-billion charge against earnings in connection with selling the drugstore chain, which had accounted for 45 percent of its annual revenues.

Sale to CVS and Jean Coutu

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In July 2004, JCPenney sold the Eckerd chain to CVS Corporation and Jean Coutu Group for a total of $4.5 billion (~$6.96 billion in 2023).[10] CVS acquired 1,271 Eckerd stores, and support facilities, in Florida, Texas, and other Southern states, as well as Eckerd's pharmacy benefits management and mail order businesses, for $2.15 billion.[10] Jean Coutu Group acquired the remaining 1,540 stores, and support facilities, in the Northeast and mid-Atlantic (essentially everything from Georgia northward) for $2.375 billion.[10]

A CVS Pharmacy in Southside Place, Texas, which was formerly an Eckerd store

The locations acquired by CVS were converted to CVS Pharmacies in late 2004 and 2005, eliminating the Eckerd name from markets such as Florida, Texas, Oklahoma, Louisiana, and Mississippi, which were historically the chain's strongholds. Even a few brand-new locations in Florida, Texas and Arizona were transformed into CVS almost as quickly as they were built as Eckerd stores.[11] The CVS purchase also included the Eckerd stores located in Colorado; however, CVS opted to close these stores.[12] As a condition of the sale, CVS accepted JCPenney's store credit card until July 2014.[citation needed]

Brooks Eckerd

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An Eckerd Drugs location in upstate New York

Jean Coutu merged the Eckerd stores it acquired with its existing American pharmacy, Brooks. The merged company was based at Brooks' corporate headquarters in Warwick, Rhode Island. The Eckerd and Brooks chains shared many of the same corporate functions. Jean Coutu operated the stores it purchased under the slightly modified "Eckerd Pharmacy" name and logo, featuring a red Eckerd capsule in an attempt to unify the Eckerd and Brooks chains.

Acquisition by Rite Aid

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An Eckerd Pharmacy in Rochester, Pennsylvania, pictured shortly before its conversion into a Rite Aid in August 2007. This location closed in October 2023.[13]

On August 23, 2006, The Wall Street Journal announced that Rite Aid would acquire 1,858 Eckerd Pharmacy and Brooks Pharmacy stores from Jean Coutu for US$3.4 billion (~$4.94 billion in 2023). The deal closed on June 4, 2007. Rite Aid announced that the two chains would be converted to the Rite Aid name, retiring the 109-year-old Eckerd banner. The merger was signed and completed as of June 4, 2007; all remaining Eckerd stores converted to Rite Aid by the end of September 2007.

The conversion process consisted of two steps: new computer systems, and a full PPR (paint, powder, re-set) which consisted of new signage and a new design scheme. Many of the stores received new paint on their exteriors, making them look more like brick than the white stucco design of most Eckerd locations. Eckerd's remaining JCPenney Catalog Centers were closed in favor of Rite Aid choosing to accept JCPenney charge cards chainwide including stores that were not former Eckerd locations .

In 2023, Rite Aid filed for Chapter 11 bankruptcy amid several opioid lawsuits and declining sales.[14] Eckerd Corporation had remained an active in-name-only subsidiary of Rite Aid, as shown in the company's bankruptcy filings.[15]

Slogans

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  • You'll like what we'll do for you!
  • America's family drugstore
  • It's right at Eckerd! (1996-1998)
  • That's the reason there's Eckerd: because America can't wait!
  • Right there with you (1998–2001)
  • Get more! (2001–2007)

See also

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References

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  1. ^ "Eckerd Offers You Advantages and Opportunities Unique in Our Industry!." Eckerd. February 3, 1997. Retrieved on June 19, 2010. "Eckerd Corporation 8333 Bryan Dairy Rd. Largo, Florida 34647"
  2. ^ "Contacting Us." Eckerd. Retrieved on June 19, 2010. "Mail: 50 Service Ave., Warwick, RI 02886."
  3. ^ Gilpin, Kenneth N. (2004-04-05). "J. C. Penney Sells Eckerd Chain for $4.5 Billion". The New York Times. ISSN 0362-4331. Retrieved 2023-11-26.
  4. ^ Eric Ruth (2006-08-25). "Del. fixture Eckerd acquired". Delaware News-Journal. Archived from the original on September 30, 2007. Retrieved 2006-08-26.
  5. ^ "History of Eckerd Corporation – FundingUniverse". www.fundinguniverse.com. Retrieved 2016-07-31.
  6. ^ "CVS to buy 1,260 Eckerd stores, overtake Walgreen". The Baltimore Sun. 6 April 2004. Retrieved 2020-04-16.
  7. ^ "J.C. PENNEY TO BUY ECKERD PHARMACIES". The Washington Post. ISSN 0190-8286. Retrieved 2020-04-16.
  8. ^ Terry Pristin (November 25, 1998). "J.C. Penney to Buy Genovese, Expanding Its Drugstore Chain". The New York Times. Retrieved December 23, 2009.
  9. ^ Matt Donnelly (July 16, 2003). "Genovese Drug Stores Take on Eckerd Name". Newsday. Archived from the original on November 2, 2012. Retrieved December 23, 2009.
  10. ^ a b c "Penney unloads Eckerd for $4.5 billion". NBC News. 2004-04-05. Retrieved 2020-04-20.
  11. ^ Abboud, Mike (2022-09-28). "CVS to close this former Westheimer Eckerd, tomorrow". Houston Historic Retail. Retrieved 2023-11-26.
  12. ^ "Business: CVS backs out of Eckerd's Colorado expansion plans". Sptimes.com. 2004-04-12. Retrieved 2009-07-24.
  13. ^ "Rite Aid to close 9 stores in Southwestern Pa". 18 October 2023.
  14. ^ "Rite Aid files for bankruptcy". CNN. October 15, 2023. Retrieved October 16, 2023.
  15. ^ "Eckerd Corporation Files For Bankruptcy". BKData. October 15, 2023. Retrieved October 15, 2023.
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