The Complete Story of Rite Aid
Meet Alex Grass. A businessman and entrepreneur, he was born to Jewish parents in Scranton, Pennsylvania. When he was nine, his father passed away in the middle of the Great Depression, leaving the family struggling to feed themselves.
During the 1950s, Grass married into the Lehrman family and started working for his father-in-law at Lehrman & Sons. This left him perfectly placed to get a feel for the market, and so when he spotted that there weren’t many affordable health and beauty stores in Pennsylvania, he knew that there was a huge opportunity. The story of Rite Aid was about to begin.
Rite Aid started out with the name “Thrif D Discount Centre”, opening their first store in Pennsylvania back in 1962. Within three years, they’d bought some competitors and opened new stores, establishing a presence in five different states.
By 1968, the company had changed its name to Rite Aid Corporation and listed itself as a public company on the stock exchange. In 1972, ten years after being founded, they had 267 stores in ten states. In 1987, they celebrated their 25th birthday by acquiring 420 new stores. This left them with over 2,000 stores and the title of America’s largest drugstore chain.
These acquisitions have been an important part of the company’s strategy, with major purchases including Perry Drug Stores (1995) and Brooks and Eckerd (2007). This helped Rite Aid to become one of the United States’ largest drugstore chains, with 5,059 stores in 19 states and over 112,800 employees.
But every company goes through good and bad times, and Rite Aid is no stranger to controversy. In 2004, the company paid $7 million to settle accusations that they’d submitted false prescription claims to the government. They’ve also faced litigation from employees, as well as class-action lawsuits from customers who accused them of overcharging insurance companies. Perhaps that’s why they’ve been in talks to sell the company.
In 2015, Walgreens revealed that they’d be buying Rite Aid for $17.2 billion, but they later ended up buying “only” 1,932 stores for $4.38 billion. In 2018, Albertsons said they were going to buy the rest of the company’s stores, but Rite Aid later said that the deal had been canceled because it wasn’t in the best interests of the company’s shareholders.
And what happened to Alex Grass, the company’s founder? He donated much of his wealth to charitable causes, including using $1.5 million to create the Alex Grass School of Business Leadership. He also donated a further $1.5 million to the University of Florida so that they could develop their Centre for Jewish Studies and create a new building for their law school.
Grass passed away in 2009 at the age of 82, but his legacy still lives on. As does the company that he founded nearly 60 years ago – for now, at least. Only time will tell whether someone else tries to purchase the company’s remaining 2,600 stores. We’ll see!
This post contains a unique collection of resources that offer a comprehensive look at the Rite Aid business story. Have a look at the following articles for more on the Rite-Aid Story.
The History of Rite Aid
Ownership And Investors
Products and Services
Facts about Rite Aid
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