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Supplier Advisory Board Meeting Update

05_SAB_SGElogoRite Aid’s category management team and supplier partners gathered in Las Vegas, Nev. on March 27 for the bi-annual Supplier Advisory Board (SAB) meeting. The meeting’s theme, “Service, Growth and Excellence” mirrored the theme of Rite Aid’s Annual Sales Meeting held a month earlier in Baltimore, Md.
Highlights of the day included:

Executive Vice President, Merchandising Tony Montini and Executive Vice President, Pharmacy Robert Thompson welcomed supplier partners before introducing President and CEO John Standley and COO Ken Martindale, who provided an update on the company’s fiscal 2012 accomplishments.
During the leadership presentations, the supplier advisory board heard that Rite Aid succeeded in growing same store sales and the number of prescriptions filled at its stores throughout last year.

In the fourth quarter, improved customer satisfaction, the continued growth of wellness+ and an expansion of the company’s immunization program contributed to positive sales results.

Also during the quarter, a significant number of former Express Scripts/Walgreens customers transferred their business to Rite Aid as a result of a dispute between the two companies, resulting in strong prescription sales and an increase in the number of prescriptions filled. Top-line sales gains led to improvements in gross margins and Adjusted EBITDA, thanks to strong efforts to control costs.
Three key initiatives were outlined for fiscal 2013: continue to grow sales, continue to control costs and continue to improve the associate and customer experience. In terms of growing sales, Rite Aid plans to continue to enhance the wellness+ customer loyalty program, maximize the investment in Wellness store remodels, expand clinical pharmacy service offerings, achieve excellence in retail execution and provide outstanding customer service.
Senior Vice President, Marketing John Learish provided an update on wellness+, touting the program’s exceptional growth and highlighting recent enhancements such as expanded reward choices and the Load2Card online coupon management tool. The participants also heard about the recent launch of Rite Aid’s free mobile app and upcoming plans for customer segmentation initiatives.

Later in the meeting, the Supplier Advisory Board moved into front end and pharmacy sub-groups to discuss topics relevant to their area of the business. Thompson kicked off the Pharmacy SAB with a pharmacy business update and an overview of fiscal 2013 pharmacy initiatives.
Group Vice President, Pharmaceutical Purchasing and Clinical Services Ernie Richardsen provided an update on Pedigree legislation and how it may impact the distribution of pharmaceuticals. He then reviewed Rite Aid’s Point of Care Compliance program.
Vice President, Pharmacy Initiatives and Clinical Services Tammy Royer presented an overview of Alex, Rite Aid’s newest consumer technology. This virtual in-store shopping assistant has been introduced in the front end of select stores and the group discussed how this technology may be applied to the pharmacy.
The front end group received updates on current projects including: Health Platform Reinvention, Supply Chain Best Practices and Wellness Store Category Innovation.
Group Vice President, Health and Beauty Bill Bergin, Vice President, Consumables and Photo Bill Renz and Vice President, Seasonal and General Merchandise Ted Williams announced three exciting, new projects.

A DSD Process Improvement project will focus on growing sales, reducing out-of-stocks and creating a planogram repository. The project will also aim enhance DSD execution through improved promotional planning, EDI and pricing capabilities. This initiative will be led by Bill Renz.
The group also introduced an Ad Order Forecasting project that aims to develop best practices that will improve sales and inventory allocation. Ted Williams will oversee this project team.

The third new project focuses on Beauty Category Reinvigoration by analyzing all aspects of the operating model in response to alternate retail formats that are redefining how women shop the beauty category. Led by Bill Bergin, the team overseeing this project will be integral to the company’s beauty positioning in the Wellness stores.

Bergin and Williams then recognized Peter Thompson of Colgate-Palmolive for his many years of outstanding service to the Leadership Council. Thompson is an original member of both the SAB and its leadership council and has long been a major supporter of Rite Aid. Mike Wovna of American Greetings was welcomed as the Leadership Council’s newest member.

Tony Montini concluded the meeting by highlighting Rite Aid’s continued focus on change by and with the SAB and by explaining the importance of, and reasoning behind, the selection of the three new projects.

Rite Aid’s next Supplier Advisory Board meeting will be held in Harrisburg, Pa. this September.