Just a couple of weeks ago, we told you that Walgreens had announced it would close nearly half of its in-store clinics in the face of withering competition. That move has nothing to do with their long-in-the-works plan to open physician-staffed primary clinics in partnership with VillageMD, however; the company just revealed that it has opened the first of five such locations in Houston. They expect the rest to open next month and in January 2020.
Walgreens, like most retail stores in the age of Amazon, has overbuilt stores in terms of square footage. Most box stores are too big, which creates a major issue when success in retail is measured by “sales per square foot.” One inherent advantage for Walgreens will be greater utilization of oversized, high-value retail space. One question, though, is whether they will be able to entice older patients who are comfortable with their current doctors to switch to Walgreens physicians who will be unknown to them. Failure to do that could mean failure to maintain adequate patient volume.