CVS change’s store name and ends tobacco sales earlier

CVS Caremark announced that it is pulling tobacco products from its shelves a month sooner than originally planned and is changing its name to CVS Health.

by John Tyburski

Copyright © Daily Digest News, KPR Media, LLC. All rights reserved.

First published at Daily Digest News on September 4, 2014

Big Tobacco took a big hit a month sooner than expected when CVS Caremark announced that it was ready to clear its stores’ shelves of all tobacco products. The company also said that effective immediately, the stores will now be known as CVS Health. The signs that are currently on the approximately 7,700 stores throughout the country will remain in place.

CVS, which is the nation’s second largest drugstore chain, announced its plans to phase out the sale of tobacco products in all of its stores near the beginning of the year. The target date for the change was originally October 1. CVS CEO Larry Merlo said that the reason for the earlier removal was that the company finished its preparation for the move ahead of schedule and not because of inadequate inventory.

The amount of annual revenue that will likely be lost because of the decision is estimated at $2 billion. However, the stocks for the number 12 Fortune 500 company have risen, closing at $79.73 on Tuesday. The growth in share value since the February announcement is about 21 percent.

Merlo said that the lost revenue will be made up in part by the focus on expanding health-related products and services. “We’re doing more and more to extend the front lines of health care,” Merlo said. Some of the services that CVS and other drugstores are moving toward are vaccinations, flu shots, and monitoring for chronic diseases like hypertension and diabetes.

Competitors like Walgreen Co. and Rite Aid Corp. will still sell cigarettes and cigars, and all of the drugstore chains will still sell nicotine gum and other cessation aids.

Many CVS stores will replace their tobacco products with signs presenting messages to customers urging them to quit using tobacco products. Some even have free tobacco quit packs that contain coupons, information on how much money will be saved when a smoker stops smoking, and a collection of Sudoku and other games to help ease the cravings in those who are trying to quit.