Rite Aid 2011 Annual Report Download - page 9

Under the umbrella of our ‘‘With Us It’s Personal’’ brand positioning, we promote educational
programs focusing on specific health conditions and incentives for patients to transfer their
prescriptions to Rite Aid. We are also emphasizing our automated courtesy refill service. We believe all
of these programs will help us improve customer satisfaction and grow profitable sales.
Associates
We believe that our relationships with our associates are generally good. As of February 26, 2011,
we had approximately 91,800 associates: 13% were pharmacists, 44% were part-time and 26% are
represented by unions. Associate satisfaction is critical to the success of our strategy. We have surveyed
our associates to obtain feedback on various employment-related topics, including job satisfaction and
their understanding of our core values and mission. We have also instituted an internal group,
consisting of managers and staff from all components of our business that is responsible for using
feedback from associates throughout the Company to create a better work environment.
As a result of more licensed pharmacists and new graduates seeking positions in many markets,
the national shortage of pharmacists has eased over the past 12 months. Although this is occurring
nationally, there is still an unmet demand for pharmacists in certain regions of the country that are
challenging to staff. We continue to offer competitive compensation plans to retain and attract current
and future pharmacists, work with colleges of pharmacy across the U.S. to recruit both pharmacy
interns and pharmacy graduates and conduct a recruiting program for international pharmacists.
Research and Development
We do not make significant expenditures for research and development.
Licenses, Trademarks and Patents
The Rite Aid name is our most significant trademark and the most important factor in marketing
our stores and private brand products. We hold licenses to sell beer, wine and liquor, cigarettes and
lottery tickets. As part of our strategic alliance with GNC, we have a license to operate GNC ‘‘stores-
within-Rite Aid-stores.’’ We also hold licenses to operate our pharmacies and our distribution facilities.
Collectively, these licenses are material to our operations.
Seasonality
We experience moderate seasonal fluctuations in our results of operations concentrated in the first
and fourth fiscal quarters as the result of the concentration of the cough, cold and flu season and the
holidays. We tailor certain front end merchandise to capitalize on holidays and seasons. We increase
our inventory levels during our third fiscal quarter in anticipation of the seasonal fluctuations described
above. Our results of operations in the fourth and first fiscal quarters may fluctuate based upon the
timing and severity of the cough, cold and flu season, both of which are unpredictable.
Regulation
Our business is subject to federal, state, and local government laws, regulations and administrative
practices. We must comply with numerous provisions regulating health and safety, equal employment
opportunity, minimum wage and licensing for the sale of drugs, alcoholic beverages, tobacco and other
products. In addition we must comply with regulations pertaining to product content, labeling, dating
and pricing.
Pursuant to the Omnibus Budget Reconciliation Act of 1990 (‘‘OBRA’’) and comparable state
regulations, our pharmacists are required to offer counseling, without additional charge, to our
customers about medication, dosage, delivery systems, common side effects and other information
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