Sponsored By

Walmart should continue to lead the pharmacy sector: report

Retailers will also continue to expand their presence in health care services

Bill Wilson, Senior editor at Supermarket News

February 13, 2024

2 Min Read
pharmacy medicine.jpeg
The drugstore and pharmacy sector revenue is projected to grow 4.7% year over year in 2024 at almost $374 billion.Getty Images

Expect pharmacies to continue to grow their health care services and for grocers like Walmart and Kroger to outpace traditional pharmacy retailers over the coming months.

Coresight Research released its Market Navigator: U.S. Drugstore and Pharmacy Retailers — A Strong Focus on Healthcare Expansion in 2024 and Beyond report which shows positive but slow growth for the market.

The drugstore and pharmacy sector revenue is projected to grow 4.7% year over year in 2024 at almost $374 billion. That’s a slowdown compared to 2023 when the estimated year-over-year growth was 7.3%.

There will be a strong demand for prescription medication and over-the-counter products along with health and wellness products, and as shoppers continue to gravitate towards prioritizing health and wellness there should be increased sales of healthy foods, supplements, and fitness-related products.

CVS Health has produced strong revenue growth over the last five years — high single digit revenue compound annual growth rate (CAGR) for fiscal 2018-2022 — but Walgreens and Rite Aid both recorded low single-digit revenue CAGR over the same time period. Walmart, however, topped them all with a 6.8% CAGR for 2018-2022, while other grocery pharmacies like Ahold Delhaize, Albertsons, and Kroger outperformed the traditional chains.

The lack of affordable health care has led to drugstores and pharmacies filling a void in the health care segment, which is expected to be a key driver for the retailers in 2024.

Private label products and prescriptions of GLP-1 drugs will continue to increase in 2024 and beyond, and the consumerization of health care, 3-D printed medicine, and generative artificial intelligence will continue to emerge in the marketplace.

Overall, consumer sentiment is likely to remain cautious in 2024, and as a result the U.S. drugstore and pharmacy sector is expected to see slow but positive growth with private label products providing a boost.

 

 

About the Author

Bill Wilson

Senior editor at Supermarket News

Bill Wilson is the senior editor at Supermarket News, covering all things grocery and retail. He has been a journalist in the B2B industry for 25 years. He has received two Robert F. Boger awards for his work as a journalist in the infrastructure industry and has over 25 editorial awards total in his career. He graduated cum laude from Southern Illinois University at Carbondale with a major in broadcast communications.

Stay up-to-date on the latest food retail news and trends
Subscribe to free eNewsletters from Supermarket News

You May Also Like