Walgreens to permanently close 5 LA-area stores

Walgreens has announced the closure of five locations across Los Angeles and Orange counties, leading to the potential loss of 93 jobs as part of a larger downsizing effort that will see around 1,200 closures nationwide.

The affected stores in Whittier, downtown Los Angeles, Orange, Placentia, and Stanton will be closing between March 20 and March 27, resulting in layoffs for various positions including pharmacists, pharmacy technicians, cashiers, store managers, and inventory specialists.

Walgreens cited growing regulatory and reimbursement pressures as reasons for the closures, with the company facing financial difficulties in recent years due to declining foot traffic, increased labor costs, and lower reimbursement rates for prescription drugs.

Last month, Walgreens’ CEO mentioned a 52% increase in “shrink” and attributed reduced sales to anti-theft measures like locking up items behind glass encasing.

Walgreens, one of the largest pharmacy chains in the US, has seen its stock price plummet by 82% in the last five years, from record highs of over $90 per share to just $9.36 per share.

Due to financial strains exacerbated by the COVID-19 pandemic and legal settlements related to opioid litigation, Walgreens announced plans to close underperforming stores across the country, with industry analysts estimating hundreds of closures.

Walgreens CEO Tim Wentworth stated that the closures and operational restructuring aim to streamline expenses and improve profitability as part of a broader strategy.

Other pharmacy retailers like Rite Aid and CVS are also facing challenges, with Rite Aid already closing over 100 stores nationwide and CVS planning to shut 900 stores over three years to focus on healthcare services and digital presence.

Amid a broader shift towards online shopping and same-day delivery services, traditional brick-and-mortar retailers including Walgreens are facing challenges to remain profitable, leading to store closures and layoffs.

The closures of Walgreens stores in Southern California may have a significant impact on local communities, particularly those relying on these locations for essential medications and household items, highlighting the changing landscape of retail and the need for adaptation.