Organization's Business Model of Walgreen Company Paper Example

Paper Type:  Case study
Pages:  5
Wordcount:  1158 Words
Date:  2022-10-25

Organization's business model

Walgreen Company builds its business in four specific areas: pharmacy, health care services, customer services, and front end. These services are enabled through new store layouts, partnerships, and new approaches to pricing, promotion and product assortments. The company provides access to pharmacy, health and wellness services and access to consumer goods and services through its drugstores retail and its two divisions such as Walgreens Health and Wellness division and Walgreens Health Services division. The division of Health Services offers prescription drug, pharmacy patients and medical plans to its customers whom they carry out through Walgreen Specialty pharmacy LLC, Walgreen Home Care, Walgreens Health Initiatives Inc. Walgreens Mail Service and SeniorMed LLC. The second division, which is the Walgreens Health and Wellness division, offers to Take care Health Systems. The heart of the company`s business is on pharmacy in which its scope of services are a specialty, retail, infusion, mail service, medical facility, and respiratory services (Lenell, Friesen, & Hormuth 2015).

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Consumers Base

Walgreens Company has a unique customer base who value convenient and fast service; it has almost 8 million daily satisfied customers in their online platform and its stores, and with over 856 million prescriptions daily. The company has an advantage in operating their business due to their reasonable price and convenience in their point cards ordering concerning the accumulated points from customer`s previous purchases (Kumar & Reinartz 2018). Also, vast selection books and DVDs together with other products make the company easy to do business.


In the 2018 fiscal year, the net sales of Walgreens` in the United States amounted to about 131.54 billion dollars which are 11.8% increase from 2017 total revenue of 118.21 billion dollars. The total revenue comprise of retail store sales of 108.73 billion dollars which is 11.8% rise from 2017 total retail sales of 97.27 billion dollars, E-commerce sales of 1.95 billion dollars that is 5.5% increase from 2017 which amounted to 1.84 billion dollars, and wholesale sales of 20.86 billion dollars which is 9.2% increase from 2017 which amounted to 19.09 billion dollars. Gross profit amounted to almost 30.8 billion dollars, with their net earnings being around 5.03 billion dollars and operating income increased by 15% to 6.4 billion dollars. It has a strong performance in pharmacy helping to push up total sales by 12.1 percent (Greenwood & Ingram 2018).

Market Share

Walgreens Company is the second largest pharmaceutical company in the U.S ranked by revenue-based market share. The company has about 16% market share with the continued integration of stores.


In the United States, several top pharmacies are competitors to Walgreens Company. The highest competitor is the CVS health corporation that dominates the most significant percentage of the market share, which is almost 24 percent, which the Walgreens follows second at approximately 16 percent. The other competitors are Express Scripts, Inc. with almost 11 percent market share, UnitedHealth Group with 5 percent, Rite Aid Corporation with approximately 4 percent, The Kroger Company 3.2 percent, Humana Pharmacy Solutions with 1.5%, Albertsons Companies with 1.2% and Diplomat Pharmacy owning almost 1.1 percent of the market share (Greenwood & Ingram 2018).

The company is facing high competition in making a partnership with other small companies and the most significant competitor CVS Health is gaming on about 69 billion dollars acquisition of Aetna health insurer. Walgreens is making small partnerships with health insurers Humana and UnitedHealth Group`s urgent care business, the MedExpress.

Supply Chain Management (SCM)

The company has a profound senior vice president of supply chain management, Reuben Slone who applies varied experience and systems thinking to make the company drugstore more efficient. The supply chain focuses on the safety of the team members across the supply chain organization and doing product availability and in-stock element to take care of their customers. On the inventory side, they improve the in-stock and take measure to cut the supply chain costs. The company also has acquired three distribution centers such as Connecticut, Dayville, and two buildings that at Philadelphia that makes up distribution centers and another new one in Spartanburg, South Carolina. The supply chain management carries out stores acquisition on a weekly basis, and after it, store conversion takes place (Greenwood & Ingram 2018).

In Walgreen Company, analytics and data are used to forecast customer's behavior and work to meet their demand. The company tailor inventory to the needs and tastes of the customers where specific stores operate. Hence, food supplements, beauty products, healthy snacks, and fresh sushi are readily available to consumers who are young professionals at Chicago neighborhood. Together with AmerisourceBergen and Alliance boots signed an agreement to form the most influential global supply chains. Through the courtesy of the daily merger drugs are provided to Walgreen`s stores, hence, reduces inventory in Walgreen`s existing warehouses. Also, the three companies have agreed to share best practices and collaborate to provide integrated solutions to clinical trial logistics.

Customer Relation Management (CRM)

Walgreens Company has a program known as The brand`s popular Balance rewards program that has more than 82 million users who are active, and it offers the customers both point accumulation and weekly savings that can be traded in during the future purchases. The program gives the company valuable insights that enable to target promotional investments more efficiently, and it increases the shopper engagement. The company uses data to understand its shoppers better and usually listens to its customers to know their wants in each store location through keeping queries and logs made personally, over social media or online. Walgreen also does an ongoing survey by inviting customers through leveraging printed receipts, phone surveys and post-purchase online. In case of changes in customer needs, Walgreens is dedicated to adapt the needs to continue bringing a great experience (Kumar & Reinartz 2018).

With consumer expectations and needs rise steeply, marketers in Walgreens have put in practical measures to deliver brilliant customer experiences to stay relevant. Deepika Pandey, a Chief Digital Marketing Officer of Walgreens Boots Alliance, applies a traditionally brick-and-mortar brand holds technology to drive competitive advantage. The company has ensured connections between their customers with staff and individual pharmacists by digitalizing. So that the customers get personalized experience and high-value even if they cannot make it into a store. Introduction of pharmacy chat allows customers to access to experts through the company mobile app and the company site any time of the day or even at night, wherever they are. Walgreens also has backed in assistive technology to improve the experience in shopping of the customers who visit the company stores. Additionally, the company has partnered with WebMD and has created a Relief Advisor that enables customers to answer various questions to get a recommendation of products that best fit their needs.


Greenwood, A., & Ingram, H. (2018). Sources and Resources 'The People's Chemists': The Walgreens Boots Alliance Archive. Social History of Medicine.

Kumar, V., & Reinartz, W. (2018). Customer Privacy Concerns and Protective Privacy Responses. In Customer Relationship Management (pp. 285-309). Springer, Berlin, Heidelberg.

Lenell, A., Friesen, C. A., & Hormuth, L. (2015). Breastfeeding support in a community pharmacy: Improving access through the Well Babies at Walgreens program. Journal of Human Lactation, 31(4), 577-581.

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Organization's Business Model of Walgreen Company Paper Example. (2022, Oct 25). Retrieved from

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