1. Matthew P. Casey & Associates welcomes the opportunity to discuss the importance, integration, and role of the supermarket pharmacy in completing detailed fieldwork, store casings and evaluations, gravity or analog modeling, and sales forecasting. SUPERMARKET PHARMACY OVERVIEW May 7, 2015

2.  Why gather pharmacy information? The goal is to INCREASE FORECAST ACCURACY by deducting total pharmacy sales from total sales in a model where applicable, especially if your subject store or site will not offer a pharmacy!

3. Supermarket competitors or even a sister store with strong weekly pharmacy sales can dramatically overstate available food sales in a PTA. Actual sales examples:  $320,000 total store (includes $80,000 in Rx) or 25% of total sales.  $435,000 total store (includes $90,000 in Rx) or 20.7% " "  $700,000 total store (includes $150,000 in Rx) or 21.4% " "  $340,000 total store (includes $65,000 in Rx) or 19.1% " "  $360,000 total store (includes $35,000 in Rx) or 9.7% " "

4. Due to (usually) much higher customer loyalty factors, impacting a well established competitor's pharmacy sales is much more difficult versus other areas of the store Here are some facts…

5. Basic pharmacy information you should know before store casings: 1. Conventional supermarket average prescription (or the more commonly used term) "script" price or value ranges from $50.00 - $75.00 2. Know your chain average, and regional variance in prescription prices 3. Pharmacist only on duty = low volume, several people on duty = high volume 4. Often pharmacy cashiers and technicians will know average weekly scripts 5. Pharmacist or a pharmacy manager often know average weekly scripts & sales 6. Store & assistant managers often know pharmacy information. Just ask! 7. Mon. & Fri.=busiest days, Saturday=1/3 less than daily, Sunday=slowest day 8. Never pretend you are a pharmacist when casing; you may be caught in a lie 9. Offer your own store's pharmacy script count before asking for their numbers

6.  Gather average weekly pharmacy sales and prescription counts similar to methods used in your casing of store and department managers (Demonstration).  Consider a pharmacy sales "add-on" based on company historic data and current competitive environment versus ever including pharmacy sales in a model.  Competition may include an independent pharmacy, chain drug stores, Target, Kmart, Walmart, Sam's Club, Costco Wholesale, and conventional supermarkets.  Understand the competitive pharmacy environment surrounding your subject store or site. Is there a nearby, local pharmacy worth consideration for an acquisition prior to opening. This data enhances the analyst's professionalism and credibility!

7.  Many chain supermarket pharmacy break evens are at least $40,000 or 700 - 800 prescriptions weekly, yet often lower for other supermarkets with limited pharmacy hours (i.e.: 9- 7 daily, 9-5 Saturday, and closed on Sundays).  Several major chains will open new stores without a pharmacy and still achieve success (i.e.: Market Basket, Hannaford, Food Lion, Giant-Carlisle, Stop & Shop, Price Chopper, Tops, Lowes Foods, ShopRite, Whole Foods, Redner's, and more).  If your subject site or store is located in a highly over stored pharmacy area or new pharmacy competition is coming soon, mention it in reports and presentations to executives. If your company or client is flexible in offering or not offering a pharmacy, ask yourself, do you really need a pharmacy here? From your marketplace knowledge, would you recommend for or against a pharmacy?

8. Additional pharmacy discussion topics:  A drive-thru pharmacy preferred location related attributes  Pharmacy restrictions in center (existing or in future store lease)  Proximity to hospitals, urgent care clinics, medical offices, senior housing  Return on Investment (ROI) may be higher without including a pharmacy  What is the overall track record of your chain or client in pharmacy (strong, average, poor)?  More pharmacy research may be needed for accurate forecasting  Inquire with local planning officials if any new pharmacy competition is coming soon, especially near your site  Walmart pharmacy information in relation to their supermarket sales