By Rite Aid, the embattled drugstore chain, has announced the closure of 27 additional locations in Ohio and Michigan, according to a recent court filing. This latest round of closures brings the total number of shuttered stores to nearly 550 nationwide since the company filed for bankruptcy reorganization in October 2023.
The Pennsylvania-based retailer has been struggling to compete with larger rivals such as CVS, Walgreens, and Target. In its initial Chapter 11 filing, Rite Aid CEO Jeffrey Stein acknowledged that the chain was “burdened by unprofitable stores,” highlighting the company’s financial challenges.
Since entering bankruptcy proceedings, Rite Aid has closed more than 520 stores, representing about a quarter of its total footprint. The majority of these closures have occurred in the company’s home state of Pennsylvania and neighboring states, with over 100 locations also shutting down in California, according to Bloomberg data.
The bankruptcy process has allowed Rite Aid to exit leases more cost-effectively, a common strategy for companies undergoing restructuring. While the drugstore chain has secured over $100 million in financing to exit bankruptcy proceedings, the latest closure announcements suggest that Rite Aid still faces significant hurdles in obtaining official approval for its reorganization plan.
As Rite Aid continues to navigate its financial challenges and streamline its operations, the impact of these closures on local communities and employees remains a concern. The company’s ability to emerge from bankruptcy as a viable competitor in the drugstore market will depend on its success in reshaping its business model and addressing the underlying issues that led to its financial difficulties.
