A pharmacist helps a customer at a Walgreens pharmacy in Wheeling, Illinois.
Walgreens plans to close 200 stores in the U.S. as it similarly shrinks its footprint in the U.K., the company said Tuesday.
Parent company Walgreens Boots Alliance earlier this year announced plans to shutter 200 stores in the U.K. and review its U.S. footprint where Walgreens operates roughly 10,000 drugstores.
The new U.S. store closures represent less than 3% of its stores, Walgreens said in a statement, adding that it anticipates “minimal disruption to customers and patients.” It said it anticipates retaining “the majority” of employees in other nearby locations.
Walgreens said it hopes to save $1.5 billion in annual cost savings by fiscal 2022 in what it’s calling the “transformational cost management program.” Walgreens expects to record a $1.9 billion to $2.4 billion earnings hit related to real estate, severance and other costs, it said in a regulatory filing.
“As previously announced, we are undertaking a transformational cost management program to accelerate the ongoing transformation of our business, enable investments in key areas and to become a more efficient enterprise,” the company said in a statement.
A Walgreens spokesman said the company does not plan to release the complete list of store closures and declined to share any more details about which locations will close.
Analysts have long worried about the number of pharmacies in the U.S. In some cities, it seems Walgreens and CVS stores line nearly every block. Worsening the situation is the fact that consumers are stopping into drugstores less and shopping online more.
In May, CVS said it would close 46 underperforming stores. In June, CVS’ head of retail warned it will close unprofitable stores as it evaluates the 500 leases that come up for renewal every year.