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Rite Aid’s turnaround seeds show signs of growth

BY Alaric DeArment

WHAT IT MEANS AND WHY IT’S IMPORTANT — The general consensus seems to be that the turnaround that the country’s third-largest retail pharmacy chain has engineered over the past few years is working.

(THE NEWS: Rite Aid looks to retain ESI patients, provide ‘superior customer experience.’ For the full story, click here.)

Rite Aid president, chairman and CEO John Standley said as much during a conference call Thursday to discuss the company’s second quarter 2013 earnings, noting the company’s "significant progress in our turnaround efforts." Analyst John Heinbockel of Guggenheim Securities seemed to agree, writing in a report, "Our bullish near-term fundamental thesis on RAD remains intact: the combination of generics and the maturation of the Wellness+ program will drive above-trend EBITDA growth for several more quarters."

Wellness+, the loyalty card program the chain launched nationwide in April 2010, has been a major driver of sales, producing many of the chain’s most loyal customers. Since its launch, several enhancements have been made, including Wellness+ for Diabetes and, most recently, a feature that allows members to have +UP points loaded to the cards automatically.

The Wellness-format stores already were trending ahead of the older-format stores early on, and they are now showing better front-end sales than the others. Recently, the company unveiled an updated version of the format in Harrisburg, Pa., which includes enhanced decor, product offerings and merchandising presentations. "The Wellness store format is another area of our business that we are constantly looking to refine," Standley told investors Thursday.

When the Wellness+ program and Wellness stores first appeared, one could say that Rite Aid had sown the seeds for a turnaround. Now, based on the results so far, one can say the crops are well on their way to harvest season.

Do you think Rite Aid’s turnaround plan is effective? Sound off in the comments below.

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Ocean Spray cuts sugar for new Craisins item

BY Allison Cerra

LAKEVILLE-MIDDLEBORO, Mass. — Ocean Spray has launched a reduced-sugar version of its dried cranberries product.

Reduced-sugar Craisins tout 50% less sugar than regular Craisins and now are available at retailers nationwide.

"Now consumers can fulfill their snacking and baking needs without sacrificing taste," Ocean Spray VP global marketing Larry Martin said. "People everywhere have been making the swap from raisins to Craisins dried cranberries, and we hope the introduction of the reduced sugar line will be a further incentive to try Craisins instead."

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Report: Condition-specific products, baby boomers and Hispanics key drivers to VMS business

BY Michael Johnsen

ROCKVILLE, Md. — According to "Nutritional Supplements in the U.S.," a report released earlier this week from Packaged Facts, supplement sales rose 7% to $11.5 billion in 2012, and are forecasted to reach $15.5 billion by 2017.

The report cited a number of factors, including a recovering economy that should have more consumers picking up on supplementing again, the aging baby boomer and a growing Hispanic population that is heavily indexed as supplement users. 

According to Packaged Facts publisher David Sprinkle, condition-specific supplements continue to grow in range and importance, and will remain a key driver of sales and new product development across various segments — including joint, brain, heart and beauty — with many of these products honing in on age-related issues. At the other end of the condition-specific spectrum, children’s supplements have been doing well, demographically book-ending the overall market and laying the foundation for the market’s future prospects, the report noted.


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