CLEVELAND – CVS Caremark announced that it will quitting sales of tobacco products at its more than 7,600 U.S. stores. The nation’s second largest drugstore chain said it is focusing more on providing healthcare.
“What kind of company do we want to be?”, said CVS president Helena Foulkes. “Do we really want to be a health care company? It became the right decision for us.”
“This makes total sense, especially for an organization and a company that’s trying to be a health care provider,” said Elad Granot, Ph.D., Assistant Dean of MBA Programs, Monte Ahuja College of Business at Cleveland State University.
CVS will phase out cigarettes, cigars and chewing tobacco by Oct. 1. The company earns $1.5 billion annually in tobacco sales but expects to lose close to $2 billion because smokers usually buy other items when in their stores.
Granot says that amount, although large, may not have a dramatic impact on the company.
“While it is about a loss of $2 billion a year, it’s out of a total sales volume of $123 billion. So when you look at it, it’s less than 2 percent.”
Rachael Shansky, a CVS customer, sees this as part of the trend to eliminate smoking altogether.
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