Dillon Leads Rx Integration at Kroger

Under the leadership of David Dillon, chairman and chief executive officer, perhaps no chain integrates the pharmacy with the rest of the store as well as Kroger Co. The nation's largest traditional supermarket operator has a long history of making the pharmacy part of the overall mission of the company. From a merchandising standpoint, I think

Dillon Leads Rx Integration at Kroger

CINCINNATI — Under the leadership of David Dillon, chairman and chief executive officer, perhaps no chain integrates the pharmacy with the rest of the store as well as Kroger Co. here.

The nation's largest traditional supermarket operator has a long history of making the pharmacy part of the overall mission of the company.

“From a merchandising standpoint, I think in many ways Kroger is more thoughtful than others in terms of health and wellness,” said Jim Wisner, president, Wisner Marketing, Libertyville, Ill. “They are able to think of that part of their business not as an adjunct to being a food retailer, but they think of it as an integral part of their business and they manage it as such.”

Kroger does an exceptionally good job of tying in its merchandising with its health and wellness promotions, Wisner explained, citing an example in which the chain was offering free bone-density screenings with the purchase of a certain number of private-label, calcium-rich products.

“They realize they are competing not just with the drug chains, but with clubs and mass [merchandisers] as well,” he said.

Kroger's commitment to health and wellness is also reflected in its acquisition last year of a minority stake in The Little Clinic, a Brentwood, Tenn.-based provider of in-store medical services. The clinics are staffed with nurse practitioners and physician assistants who are authorized to diagnose, treat and write prescriptions for many common illnesses and minor injuries. Analysts have said walk-in clinics like those could play a major role in helping reduce health care costs as an alternative to emergency-room visits.

At the time of that investment just over a year ago, Kroger had 26 Little Clinic locations in its stores, and it pledged that its investment in the company would fund a “substantial rollout” of the clinics. Kroger has since added a net 58 locations and now has 84 branded Little Clinics inside its supermarkets.

Kroger also is seeking to expand its health care expertise into its convenience-store division, which includes 800 c-stores under the Kwik Shop, Tom Thumb, Turkey Hill, Quik Stop and Loaf n' Jug banners.

The retailer has already been testing one convenience store offering prescriptions — a Tom Thumb with a Kroger-brand pharmacy that opened in 2007 in Pensacola, Fla. Last month, Kroger said it would build two new Kwik Shop convenience stores in the Wichita, Kan., area that will include Dillons-branded drive-through pharmacies.

Kroger has also been cited for its efforts to provide health care for its workers. Earlier this year, President Obama lauded Dillon at a Kroger store in Virginia, where he was promoting his health care reform effort.