CVS to Quit Selling Tobacco Products
Join us at Entrepreneur magazine's Growth Conference, Dec. 15 in Long Beach, Calif. for a day of fresh ideas, business mentoring and networking. Register here for exclusive pricing, available only for a limited time.
CVS plans to stop selling cigarettes and other tobacco products in all 7,600 stores across the U.S. by October, parent company CVS Caremark announced this morning. This is the first time a national pharmacy chain has dropped tobacco from its shelves.
With the change, the nation’s largest drugstore chain positions itself firmly on the side of medicine -- even if it costs the company billions.
"Ending the sale of cigarettes and tobacco products at CVS/pharmacy is the right thing for us to do for our customers and our company to help people on their path to better health," said Larry J. Merlo, CVS Caremark CEO, in a statement. "Put simply, the sale of tobacco products is inconsistent with our purpose."
The company estimates it will lose approximately $2 billion in revenues annually from tobacco shoppers. This loss equates to approximately 17 cents per share. However, the company also has much to gain by establishing a clear brand that emphasizes health over all else, encouraging increasing collaboration with the pharmacy chain across the health-care industry.
One of the supporters of CVS’s decision is President Obama. “As one of the largest retailers and pharmacies in America, CVS Caremark sets a powerful example,” the president said in a statement.
As pharmacy chains have become an increasingly important part of the health-care system, the continued sale of tobacco has come under fire. In 2010, the American Pharmacists Association urged pharmacies -- including groceries and other chain stores containing pharmacies -- to discontinue tobacco sales. Today, CVS’s decision puts pressure on other chains to follow suit.