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Rite Aid shuts hundreds more stores - making withdrawal from Midwestern states almost complete
Rite Aid has now shut almost all of the stores it once had in Michigan and Ohio - as it cuts all ties with the two Midwest states.
In total across the US, the drugstore has now closed 856 stores since October 2023 - more than a two-fifths of the roughly 2,000 locations it operated before it fell into bankruptcy.
The latest closures - 74 so far in August- were all in the two Midwest states apart from one each in California and Washington. That is on top of 169 in July, all in Ohio and Michigan.
The retailer has now shut 95 percent of its locations in Michigan and 93 percent in Ohio. Given the rate of filing new closures every few days, its withdrawal from the two states could be complete in weeks.
There are just a dozen left in each - yet under a year ago the two states had the fourth and fifth highest number of Rite Aids in the US.
After filing for Chapter 11 bankruptcy protection in October, Rite Aid announced it would initially shutter 154 underperforming stores across a dozen states. In the nine months since then, it has shut an additional 702.
One analyst told ABC27 in September the worst case scenario was that 700 stores would close, which Rite Aid has far surpassed.
The chain has been facing a series of challenges.
Drugstores, generally, are struggling to compete with big-box chains and with Amazon, which launched its own online-only pharmacy in 2020.
The most recent closures came in filings dated July 29, August 2, 5 and 9.
Experts think that Rite Aid is moving out of areas where it cannot compete with much bigger chains CVS and Walgreens, which also owns Duane Reade. Instead it is focusing where it can aim to be number two behind one or the other, such as in Pennsylvania.
A major factor in Rite Aid's ongoing bankruptcy is the fact that it had been unable to settle hundreds of costly lawsuits accusing the company of overprescribing opioids.
It's unclear when Rite Aid will emerge from bankruptcy, but it plans to return with about 1,300 stores total, a far cry from when it operated 5,059 locations in 2008.
'Rite Aid is hoping to get itself back onto a firm financial footing, although it will emerge from bankruptcy as a much smaller business with far fewer stores,' Neil Saunders, managing director of GlobalData, told DailyMail.com.
DailyMail.com approached Rite Aid for comment but didn't receive an immediate response.
Walgreens, the second largest pharmacy in the US behind CVS, is grappling with its own financial troubles, announcing last month it would close a 'significant' number of its 8,700 US stores.
Upon seeking bankruptcy protection last October, Rite Aid announced it would initially shutter 154 underperforming retail locations across over a dozen states. Over the past nine months, it shut an additional 618
Three people browse the sparse shelves of a Brooklyn Rite Aid in August 2023, months before it would declare bankruptcy
A woman browses the shelves of a Rite Aid in Alhambra, California on October 18, 2023. This store was due to close in days following the bankruptcy announcement on October 15
Rite Aid was once the the third largest drugstore chain in the country, operating over 5,000 locations across the US. After the bankruptcy, that could dwindle to just 1,300
The widespread 'retail apocalypse' that has seen brick-and-mortar stores struggle to combat rampant theft and increasingly tight margins is certainly not contained to drugstores.
There were almost 2,600 store closures in the first four months of 2024. If that trend continues, almost 8,000 will have been lost by the end of the year.
In recent months, Walmart has closed three more of its underperforming locations. Best Buy closed ten in March.
Dollar stores have been hit hard too, with 99 Cents Only announcing in April it would shutter all 371 of its locations across California, Texas, Arizona and Nevada.
The 1,000 closures of Family Dollar and its sister company Dollar Tree will happen over the next three years.
Express - a mall staple - filed for bankruptcy in April and said it would shut 95 Express outlets alongside all of its UpWest stores.
At the start of May, Rue21 - the teen fashion chain that is a fixture in malls across America - also said it will shut all its 543 US stores after going bust.
Badcock Home Furniture & More said at the end of July it is closing all its 380 stores dotted around the South after it fell into bankruptcy earlier this year.
And last week, it merged that Big Lots is shutting 315 stores across multiple states as its financial woes get worse.