...Case Study - The McKesson Corporation The McKesson Corporation is a distributor of non-durable consumer goods in the USA. A large part of its business is the distribution of prescription and off-the-shelf drugs, toiletries, perfumes and sundries to retail drugstores. In overly simplistic terms, McKesson purchases these goods from the large manufacturers of pharmaceuticals and toiletries, stores them in warehouses, takes orders from drugstores across the USA and then distributes the goods to the stores. This is a low margin and competitive industry. Around 1980 the senior management of McKesson was looking carefully at its corporate strategy. Their view was that competition was largely determined by price and cost and so decided that the key to competitive success was a strategy based on a ruthless efficiency drive. They also decided that IT could help them increase efficiency. At this point in time McKesson used computers for accounting and financial purposes but not for anything else. The organization then proceeded to put its strategy of improving efficiency through an increased use of IT into practice. The steps it took were in the following sequence. Step 1. Stock control in the warehouses was computerized. The aim was to reduce working capital costs by cutting stock levels. Step 2. McKesson computerized the sales/ordering process. This allowed orders received by post or telephone at the warehouses to be entered on a computer, instead of being recorded manually as previously...
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...1. Introduction 1 1.1 Research motivation and objectives 1 1.2 Research contributions 3 2. Theory 4 2.1Trust vs. customer trust 5 2.2 Customer trust vs. online trust 8 2.2.1 Define customer trust in online shopping 8 2.2.2 The importance of customer trust in online shopping 9 2.2.3 Findings from past studies 9 2.3 E-business Vs E-drugstore 12 2.3.1 A glance of pharmaceutical industry & drugstore sector 14 2.4 Website factors that might affect the perceptions of customers’ online trust 18 2.4.1 Website factors VS consumer factors 18 2.4.2 Discussion of website factors 19 3. Methodology, data, and model 36 3.1 Methodology and data collection 36 3.2 Model & analysis 37 3.2.1 Variance analysis 37 3.2.2 Factor analysis 40 4. Results and discussion 43 4.1 Results for research questions 43 4.2 Results from factor analysis 47 5. Managerial implications 49 6. Limitation and further research 54 7. Conclusion 56 Appendix A: Customer trust survey 57 Appendix B: Factor analysis of attributes of websites factors (Heavy Loadings) 58 Appendix C: Frequency table 59 References 60 1. Introduction 1.1 Research motivation and objectives It is commonly accepted that e-business is beneficial to the further growth and success of businesses, government, and not-for-profit organizations (Sultan et al, 2002). Specifically, the advent of the Internet has brought new business opportunities to the retail industry. However, no matter how wonderful e-business is, many small...
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... Soma.com whose entire business strategy was similar to what CVS was attempting to achieve. Foulkes was faced with critical strategic challenges in transforming their new Information Technology (IT) initiative, Soma.com, to CVS.com. In this paper, we will introduce the retail pharmacy industry and its protagonists, achieve a bird’s eye view of CVS’s organizational structure, understand who CVS’s customers and competitors are, introduce the term Alignment Link in terms of overall strategy, implement the SWOT analysis tool to gauge CVS.com’s position, and conclude with a recommendation for the stated implication of the case. Retail Pharmacy Industry Since the 1990’s, the drugstore industry has been a very competitive market. There were multiple mergers and acquisitions, in addition to tactical challenges to obtain nationwide dominance. The $100 billion market...
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...compounded or dispensed. It deals with the proper utilization of various medications. An example of a pharmacy is a drugstore. We can buy drugs over-the-counter or by doctor’s prescription. It provides medications to customers who need to take them in order to heal sickness and diseases. A lot of drugstores have emerged nowadays as well as the increasing needs of the people. The only difficulty is that some people cannot afford to buy the expensive medicines. Mike Mendoza finds a way to solve this problem. With effective but affordable medicines, it aims to solve the hindrance of what people are facing nowadays which are high-priced medications. Founded by Mr. Mendoza, Mendoza Drugstore was established on March, 2011 in Santa Maria, Bulacan. The company has two employees and one administrator. Although the pharmacy provides cheap but effective medicines to their townsmen, problems arise with the pharmacy performance. The sales and inventory transactions in the store using only calculator has a very slow processing considering they do not have a computerized sales and inventory system yet. The processing of sales and inventory usually begins when a customer buy medicines over the counter. The employee will now perform the sales transaction. After the transaction, receipts should be given to the customers but they still do not have a receipt processing system. On the other hand, the medicines bought by the customers should be automatically reduced in the inventory area...
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...Walgreens: Strategic Evolution 1 America’s largest drugstore chain, Walgreens, had 8,210 locations by 2011, including 7,761 drugstores. Almost 75 percent of Americans lived within five miles of a Walgreens pharmacy, and more than 6 million customers were served each day. Walgreens issued more than 800 million prescriptions annually, representing 20 percent of the U.S. market. Its online business, Walgreens.com, had almost 17 million visitors per month. Walgreens’ strategy had evolved for more than a century in business. By 2012, the company faced a number of major strategic questions, including international expansion and a changing health care environment. History of Pharmacy2 People have been trying to create remedies for illnesses and ailments since the beginning of time, but most historians credit Babylon with the first organized apothecary. This was followed by the Romans, who created a system of pathology and therapy that became standards for Western medicine for more than 1,000 years. For the most part, though, pharmacy remained a sketchy and shadowy business for centuries, practiced by (among others) witch doctors and alchemists. Advances in medicine and the Renaissance era led to more structured and scientific approaches. In 1240, German Emperor Frederick II issued a proclamation establishing the practice of pharmacy along three tenets: (1) separation of the pharmaceutical profession from the medical profession; (2) official supervision (regulation) of pharmacy; and...
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...in a realistic scenario • Define how various leadership and motivational models may be used best to improve productivity and job satisfaction within organizations. • Demonstrate how various leadership and motivational models may be used best to improve productivity and job satisfaction within organizations • Demonstrate the importance of an ethical approach to business • Provide an example of how various aspects of organizational life can create negative impacts internal and external to the organization • Provide an opportunity for critical thinking as noted through multiple opportunities to incorporate theory and resolve problems • Apply organizational-behavior strategies to management scenarios utilizing a systems approach • Discuss methods for undertaking planned-change programs within...
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...Introduction Walgreen Co. and CVS/Caremark are two of the largest retail drugstore chains in the United States, offering consumers a variety of basic consumer goods including household products, convenience foods, personal care, beauty care, photofinishing, and seasonal items, as well as over-the-counter and prescription medication. In addition to their well-known retail pharmacies, both companies also operate a health services health and wellness division. Within the retail pharmacy industry CVS/Caremark and Walgreens continually battle for the retail position. This document will offer an overview and basic competitive analysis of the two companies. Background Location & Type of presence (brick and mortar, or internet) According to the CVS/Caremark 2011Annaul Report, page 23; as of December 31, 2011, the CVS/Caremark Retail Pharmacy segment operated 7,327 retail drugstores with 7,271of these retail stores operating a full service pharmacy. Their stores are located in 41 states and the District of Columbia and Puerto Rico. Additionally, within these retail stores operate 657 health care clinics conducting business under the Minute Clinic name. The retail pharmacy stores operate primarily under the CVS/pharmacy or Longs Drugs names. In addition, the Pharmacy Services segment operates under the names CVS Caremark Pharmacy Services, Caremark, CVS Caremark, Care Plus CVS/pharmacy, Care Plus, and Rx America to providing pharmacy benefit management services to employers, insurance...
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...On October 14, 2010, the United States Attorney’s Office for the Central District of California announced that CVS Pharmacy, Inc. was fined $77 million (including $75 million civil penalty and the forfeit of $2.5 million profit) for its unlawful sales of pseudoephedrine, a regulated drug, to criminals between September 2007 and November 2008. During that period, the company failed to comply with laws that limit the quantity of the drug sold to individual customers. The sales, according to the Attorney’s Office, directly caused an increase the production of methamphetamine in California. CVS Pharmacy, Inc (“CVS/pharmacy”) is the retail pharmacy subsidiary of CVS Caremark Corporation (hereinafter collectively referred to as “CVS”). In addition to retail pharmacy, CVS also runs pharmacy services, retail clinics, and mail-order pharmacy businesses. In fiscal year 2010, the company had net revenues of more than $96 billion and a net profit of more than $3 billion. Selected financial data by business segments (pharmacy services, retail pharmacy, and corporate) is shown in Exhibit 1. CVS was the 18th largest company on the Fortune 500 according to its 2010 annual report and CVS/pharmacy is one of the largest retail pharmacy chains in the United States. As of December 31, 2010, it operates more than 7,100 retail pharmacy stores in the United States. Exhibit 2 shows the number of CVS/pharmacy stores in each state (as of December 31, 2009). Today’s CVS (listed on New York Stock Exchange...
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...Walgreens Co., America’s premier pharmacy is what Charles R. Walgreen called his neighborhood drugstore that has grown into a nationally recognized fortune 500 company. Charles R Walgreen was born in Galesburg, a small town in Illinois, but shortly relocated to a town sixty miles away named, Dixon, Illinois. Dixon is where the dream of Walgreens Co. began. At the age of sixteen years old, working in a factory, Charles cut off the top of his middle finger and ended his athletic career. This led him to take a job at Horton’s Drug Store in Dixon, Illinois. Charles absolutely despised this job but needed to do something to get him through school. Once school was out, in 1893 Walgreen relocated to Chicago, Illinois where he discovered that the drugstore industry wasn’t so bad after all. Walgreen gained knowledge from some of the best pharmacist known to man, Samuel Resenfield, Max Grieben, William G Valentine, and Isaac W Blood. While working with pharmacist he discovered that maybe working for Horton’s Drug Store all of those years ago was going to pay off. Charles realized that in the Chicago area the pharmacy/drugstore was very prominent and that he needed to do something to stand out. When it came to a drugstore/pharmacy consumers had many choices in the Chicago area. In 1901, he had saved up enough money to put a down payment of his own pharmacy. “Walgreen’s drugstore was located in Barrett’s Hotel at Cottage Grove ad Bowen Avenue on Chicago’s South Side.” (walgreen...
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...with lower price which was achieved by importing cattle. Later on Group gradually extended their business objective was to supply Food products to local country as well as their neighbouring countries. Dairy Farm International Holdings Limited was the leading food and drugstore retailer in APAC region. DFG is Hong Kong based company operated in a number of supermarkets, Drugstores and convenience stores in neighbouring countries such as Singapore, China, Australia, India, Indonesia, Malaysia and New Zealand. Also this group had interest in Caterings service and Hypermarkets in Hong Kong and Taiwan. Although DFG increased its size across APAC , still its sales was down key reason for the down slide in sales was Asian Financial Crisis was partly blame and growing competition from Europe and US Retail Chain hope establish their Business in APAC Region. Even though DFG was a leading group in APAC region, there was a huge pressure to Change its Business strategy to revamp its market lead position. Thus DFG recruited high quality senior management employs, hence its over head cost got increased but they believed it will be regained in future. DFG Strategic Vision: “Our vision is to be the leading food and drugstore retailer in Asia Pacific region in terms of Sales and long term shareholder value creation” To reach that vision they adopted a three pronged business strategy. First it wanted to defend its Current markets, second it wanted to respond to competitive pressure by restructuring...
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...Competitive Companies and industry analysis The following competitor analysis will focus on the main rivalries of Walgreens in the United States as well as in Germany. The purpose is to evaluate the ‘market environment’ in order to decide on the appropriate entry strategy and to determine which current competitors constitute a threat for Walgreens. The competitor analysis is an essential measurement to improve decisions regarding the entry of Walgreens into the German market. The framework for the competitor analysis is based on the concept of ‚Porter’s Five Forces’. Porter identified five competitive forces that shape every single industry and market. These forces help us to analyze everything from the intensity of competition to the profitability and attractiveness of an industry. Figure 1 shows the relationship between the different competitive forces. | Figure 1: Porter\'s five competitive forces | Threats of new entrants and barriers to new entry Germany has made some restrictions regarding U.S trade and investment and the government has established formal barriers. It is therefore the case that foreign companies have a harder time to enter the German market because of the government restrictions. Government institutions need to verify the safety and quality of the products and companies need invest more for that reason (Strong, 2013). The bargaining power of suppliers According to M. Porter (2008) the threat of bargaining power of...
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...Dixon, Illinois Walgreen started his journey to Chicago where he worked a long side many innovative pharmacists of his time. He had a strong desire to give customers exceptional customer service, give customers a selection of many goods that were affordable, and to offer customers high quality prescriptions while keeping costs low. He decided to open Walgreens Drugstore and never imagined that one day Walgreens would be the largest drugstore chain in the United States. Walgreens may be the most successful drugstore chain, but it certainly didn’t get this way without its fair share of challenges along the way. By 1930 there were over 500 chains and was well on its way to becoming a major contender in the pharmacy business. When the Great Depression hit, like any other business his stores were affected by the slowing dying economy. However, he used this time to keep changing his business for the better. Upon his death in 1939, Walgreen left his company and well trained management team to his son, who continued to keep the chain alive and thriving and making it the Walgreens we know today. A major blow came to the iconic drugstore in 2011. For the first time since its opening, Walgreens faced financial hardships. Costs of operating were outrageous and were out weighing the return profits; investors and shareholders weren’t making any money and hadn’t been. According to John Palizza, a graduate business professor at Rice University, "What started to happen in the mid-2000s is they got...
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...Marketing Project: Walgreens Company Table of Contents Introduction………………………………………………………………………….3 Market Situation/External Analysis………………………………………………..3 Current Industry…………………………………………………………………….3 SWOT Analysis………………………………………………………………………4 Major Changes and Trends…………………………………………………………6 Key Success Factors……………………………………………………………….…8 Marketing Strategy………………………………………………………………….9 Segmentation Strategy……………………………………………………………….9 Target Market Description and Strategy…………………………………………..13 Positioning……………………………………………………………………………15 Marketing Mix Strategy………………………………………………………….….18 Marketing Objectives………………………………………………………………..18 Product Strategy……………………………………………………………………..21 Pricing Strategy……………………………………………………………………...23 Promotion Strategy………………………………………………………………….25 Distribution Strategy………………………………………………………………..27 Forecast………………………………………………………………………………29 Conclusion……………………………………………………………………………31 References……………………………………………………………………………32 Introduction Walgreens is established as one of the leading competitors in the drug store industry. Over the years, Walgreens has developed a very well-known and respectable name for itself through different marketing strategies and company strengths. Like any company in a competitive market, Walgreens has its share of opportunities and threats, and has continued to remain at the top of the industry. Providing such a wide variety of products and services to its very diverse customer base means Walgreens must stay up-to-date...
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...Though frowned upon by many Americans, globalization seems to be the new norm amongst numerous large corporations. Walgreens seems to be taking advantage of mergers and globalization, venturing out into the rapidly developing markets overseas. The Deerfield, Ill-based Company bought 45% of United Kingdom-drugstore chain Alliance Boots back in 2012. In a short time the success of this acquisition allowed Walgreens to present the proposal of buying the remaining 55%. “In 2014, shareholders agreed to the proposal allowing a corporate reorganization resulting in Walgreens becoming a wholly owned subsidiary of a company to be known as Walgreens Boots Alliance” (McCoy, 2014). While planning to buy the remainder of Boots Alliance, Walgreens originally planned to incorporate a headquarters in Europe. This would allow them to take advantage of a legal tax inversion, however, it was brought to their attention the potential beliefs that they would be undermining the American tax system. Since then, the Department of Treasury created new regulations that would make such inversion, while still legal, less profitable and harder to execute (McCoy, 2016). A tax inversion is where U.S. organization purchases a firm domiciled in another nation with a lower corporate expense rate (say the U.K. alternately Ireland) and "migrates" the purchaser's assessment home to that of the offering organization. “A tax-motivated deal rationale may play well to shareholders, but holds the risk of intense criticism...
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...card Prescription Filled Patient Pays or show Health care card Pharmacist Counsels Patients Pharmacist Counsels Patients Pharmacist verify Prescription & fill Pharmacist verify Prescription & fill Call Verify Drug Brand (Generic) Call Verify Drug Brand (Generic) Pharmacy Technician * Pharmacy Technician * Grocery or Drug Store Pharmacy Grocery or Drug Store Pharmacy HMO On-site Pharmacy HMO On-site Pharmacy Mail Order Pharmacy Mail Order Pharmacy I will utilize the SIPOC model to further illustrate the issues surrounding Pharmacy fatigue. The health care provider fills the role of supplier providing health care to the patients and writing the prescription. Prescriptions are input into the system by the provider which may be part of a Health Maintenance Organization (HMO). The information is received by the onsite pharmacy, grocery/drug store or...
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