Five Forces
Rivalry: High
- The level of rivalry that Walgreens has is high. It competes with other well known drugstores and pharmacies such as CVS, Rite Aide, Duane Reade and etc. These competitors mostly provide the same services that Walgreens provides.
- Response: In order to stand out from it's rivals Walgreens has opted to provide added services such as Western Union and delivering prescriptions to its customers. Western Union has been added to the Walgreens sales system, so consumers are able to access their Western Union profiles at a kiosk.
- The level of bargaining power that consumers have is relatively low. Items are given at a set price given by the inventory system. The only way prices may be changed are when an item is being advertised at a different price then it actually is and it does not appear on the screen during the transaction.
- Response: Walgreens responds by sending customers circulars of advertised items on sale for the week. Walgreens also offers consumers the option to buy from their online website and offer customers sales and discounts online.
Threat of Substitution: High- Customers can get their medicine, natural supplements, healthy eating diet and homemade remedies at any other pharmacy
- Most convenience products in the store are sold at other stores
- It's very expensive for people to jump into the same level of competition with Walgreens because of the brands scale. With over 8,000 stores, they are the largest drug retail chain in the Unites States
- Although it is easy to open a small privately owned pharmacy down the street from a Walgreens
- The level of bargaining power of suppliers is considered to be medium. Suppliers still have the choice to supply their products to Walgreens or not. But Walgreens is a huge company, most suppliers choose to stay with Walgreens.
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