Rite Aid to Cut Roughly 400 Jobs in Management Shake-Up
Rite Aid said on Tuesday its CEO would exit as part of a revamp of its leadership, and that it would cut about 400 corporate positions. Camp Hill, Pennsylvania-based Rite Aid said the layoffs will affect more than 20 percent of corporate positions located at the company’s headquarters and across field operations. The company expects annual savings of about $55 million from the restructuring, of which about $42 million will be realized within fiscal year 2020. John Standley, CEO since 2010, will remain in the post until the appointment of his successor, Rite Aid said. Chief Financial Officer Darren Karst and Chief Operating Officer Kermit Crawford will also be leaving the company.
Total Retail's Take: Rite Aid has struggled to right its course following two recent events that shook the company: the sale of more than 1,900 of its stores to Walgreens Boots Alliance in 2017 (following a failed merger attempt with WBA), and the termination of its merger with Albertsons Cos. last year due to shareholder opposition. As the pharmacy industry has grown more competitive, particularly with the entrance of online competitors, including Amazon.com, traditional store-based retailers in the category have looked to bolster their operations — often through acquisition — to stop the slide in declining market share. The outlook for Rite Aid is murky at best at this point, as the company seeks to reverse declining sales and profits while also finding the right leadership to orchestrate its turnaround.