Rite Aid 2013 Annual Report Download - page 7

Expanded Healthcare Services—In fiscal 2013, we continued to expand the role of our Rite Aid
pharmacists in delivering wellness services that go beyond simply filling prescriptions. A key area of
focus has been our immunizations program, which has grown significantly in recent years. In fiscal
2013, pharmacists administered nearly 2.4 million flu shots compared to nearly 1.5 million the previous
year, an increase of about 60%. We also increased the number of immunizations we administered for
other disease states such as shingles, pneumonia and whooping cough. Continuing to expand the
volume and types of immunizations that we can perform will be an area of focus for fiscal 2014.
We also put greater emphasis on prescription compliance and adherence programs in fiscal 2013,
including the roll out of the Rite Care Prescription Advisor. The Rite Care Prescription Advisor gives
our pharmacists a tool for initiating one-on-one consultations with patients in order to explain the
health benefits of taking medications as prescribed. Other key pharmacy services include our expanded
efforts to provide Medication Therapy Management services to patients with complex medication
therapies and specialized services to patients with diabetes.
We are also introducing unique ways for customers and patients to conveniently access the
healthcare services they need. In conjunction with Optum Health, we introduced Now Clinic Online
Care services in fiscal 2012 to select Rite Aid pharmacies in the greater Detroit area. We have since
expanded these clinics to select stores in Baltimore, Boston, Philadelphia and Pittsburgh. These virtual
clinics provide patients with real-time online access to qualified medical care, information and resources
from nurses and also physicians, who have the ability to diagnose and potentially write prescriptions for
our patients.
We will continue to grow and develop our pharmacy and healthcare-related service offerings to
better meet the needs of consumers and strengthen our brand of health and wellness.
Prescription File Purchases—In fiscal 2013, we increased the amount of capital allocated to the
purchase of prescription files to $67.1 million, up from our $35.0 million investment in fiscal 2012. We
plan to continue this level of spending on prescription file purchases in fiscal 2014, as they typically
deliver a strong return on investment.
Customer Service—We have put several store operations programs in place to improve the
customer service experience, including our chain-wide emphasis on greeting our customers more
frequently and assisting them with their purchases. Our emphasis on delivering an outstanding customer
experience continues to pay off. According to the American Customer Satisfaction Index, independent
and well-respected measure of customer satisfaction, our score increased by three percent this year, and
we now hold the top position among the three major drugstore chains. We have also made investments
in technology to make it easier for our store associates to perform necessary tasks such as price
changes and backroom inventory management. By providing our associates with the ability to execute
these tasks more efficiently, we give our store teams more time to focus on providing excellent service
to our customers. During fiscal 2013, we increased funds allocated for training our store and field
associates and strengthening their customer service skills. We plan to further increase our funding levels
for training in fiscal 2014. We believe this additional focus on customer service has and will continue to
help us drive our improved overall performance.
Cost Control—We made significant reductions to our SG&A expense over the past few years
through better control of store labor and other costs in the stores, consolidation of our distribution
center network, a centralized indirect procurement function for all non-merchandise purchases and
through initiatives aimed to simplify our processes in the stores and at our Corporate office. We will
continue to focus on controlling costs in fiscal 2014 so that we can maximize the benefits of our sales
and customer service initiatives and capital investments.
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