CVS Health, the parent company to CVS Pharmacy’s recently announced that it has come up with a plan to cut costs and save a large amount of money over the next four years. The CFO announced that while their plan does include the closing down of up to 70 stores locations sometime in 2017, there are other facets of the plan that will help drive down costs. Unfortunately, closing stores and laying off employees is an all too common way these days to quickly reduce costs and these large companies see this as just a cost of doing business.
Labor cost is often the first place so many large companies often chose in order make big cuts. This is because they often have a large number of employees spread across the many locations that they own. By closing 70 locations, they will reduce their labor cost and the cost of operating the stores significantly in areas that are underperforming.
Unfortunately, this business decision will have a lasting effect on the each of the communities that will be losing a big source of employment, as CVS Pharmacy’s employee a good number of employees at it location. The other part of the equation is that many people rely heavily on the many health services that they have come to enjoy at their local CVS.
It is likely that CVS Health understands this because this closings of the 70 stores was just part of their two-pronged approach. Along with closing all of the stores across the country, they are wanting all pharmacists and clinicians in the remaining locations to become more actively involved with their customers healthcare needs. In other words, they want them to encourage them to make better choices when it comes to their healthcare. This includes using CVS Health’s own insurance plan.
With all that today’s large pharmacies provide to the customers in the communities that they are located in it is very important that they figure out how to stay profitable and not have to continue to close down these valuable pieces to the health care puzzle for so many people.