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'The Barnes & Noble' of the drug channel.

WALNUT CREEK, Calif. -- The remodeling of Longs Drug Stores outlets, says executive vice president and chief merchandising officer Bruce Schwallie, is going a long way toward linking the chain's pharmacies and front-end sections and forming an integrated whole.

With the renovated stores' focus on health, wellness, beauty and convenience, consumers can feel that Longs is special and different, he notes. And by making the retailer a health care destination the remodeling program has gone a long way toward positioning Longs as the "Barnes & Noble of drug stores," adds Schwallie.

Among the company's most powerful magnets is the Longs Senior Advantage initiative. The free program gives uninsured senior citizens discounts on prescription drugs and 10% off all Hallmark Cards Inc. merchandise, private label products and one-hour photofinishing.

Members also get $5 off Longs' osteoporosis, stroke and thyroid screenings, and a free glucose test with a cholesterol screening. In addition, health newsletters, refill reminders and pharmacy bulletins are provided without charge.

The program, which predates Medicare drug discount cards, generates 2% to 3% of the chain's pharmacy volume.

The program's discounts on front-end items reinforce the positioning of Longs' outlets as stores where the prescription counter and front end are united by a common thread.

Schwallie notes that extensive selections of over-the-counter drugs and other personal care products make the retailer an "authority" in the health and beauty aids market. With its large store sizes the chain has no need to compromise on assortments in core categories, he emphasizes.

To become even more authoritative in its primary categories, Longs has upgraded its merchandising with widened aisles and elevated gondolas in the remodeled units. As well, adjacencies have been changed in the renovated stores to keep health products with other health products and beauty items with other beauty items. Moreover, some of the changes have been added to nonremodeled units to establish a consistent presentation across the chain, according to Schwallie.

Planogramming discipline has benefited Longs tremendously, he adds. Having the stores adhere to the new merchandising approach is vital, and executive vice president and chief operating officer Rick Dreiling has put in a yeoman's effort to make them do so, Schwallie notes.

Also enhancing merchandising is Longs' movement of more and more products into self-distribution. The chain, which maintains extensive dealings with rack jobbers and direct-to-store merchandisers, traditionally used its warehouses primarily for promotional goods. But it has now moved film, batteries, candy and some H&BAs into its three distribution centers in Lathrop and Ontario, Calif.

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Title Annotation:State of the Industry
Comment:'The Barnes & Noble' of the drug channel.(State of the Industry)
Publication:Chain Drug Review
Geographic Code:1USA
Date:May 2, 2005
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