Rite Aid’s ‘Zombie’ stores are taking over America

Rite Aid has become a terrifying sight across America.

Once a staple of the pharmacy business, the chain has filed for bankruptcyslashing its footprint by more than 40% in just a few years. As the shops close and the shelves are empty, consumers are left searching for prescriptions and basic things of competitors like Walmart and Amazonleaving the future of Rite Aid hanging on a dizziness.

In 2023, Rite Aid filed for bankruptcy and closed 470 locations, making it the retailer in the drugstore sector to close the most stores that year, according to Coresight store closing data. At the time, Rite Aid had 2,324 locations. Just one year later, it had reduced its footprint to 1,818 stores, with an additional 188 closures planned for 2025.

As the Philadelphia-based company navigates its way out of financial trouble, its shrinking footprint paints a terrible picture of the wider challenges facing the pharmacy sector.

“The decision to close a store is not one we take lightly,” spokeswoman Alicja Wojczyk said in a statement for Rite Aid to Quartz. “The company is constantly assessing its retail footprint to ensure we are operating effectively while meeting the needs of our customers, communities, partners and overall business.”

Now, Rite Aid is a shadow his former self. As of early December, about 100 Rite Aid locations remained open in the Philadelphia region, but many of these stores were operating as “zombies” — still open, but increasingly empty. Shoppers often find the shelves barren, with some sections out of stock or lacking basic products. In many stores, top items locked behind glass cases, creates frustration and prompting customers to find alternativesalways turned to Amazon for online shopping.

This growing vacancy isn’t limited to Philadelphia, and for some sellers, it’s the best time to get in and clear the house. Experts believe that these closed stores present an opportunity for other retailers. Steven H. Gartner, executive vice president of real estate company CBRE (CBRE-1.04%), told the Philadelphia Inquirer that many of the vacant locations are in good condition and have been repurposed by grocers such as Aldi and Dollar General (DG+ 0.34%).

But the question remains, why is Rite Aid struggling? The combination of fierce competition and shifting consumer habits has made it difficult for the chain to maintain its relevance. Retail giants like Walmart (WMT-1.22%) and Amazon (AMZN-1.45%) is increasingly gaining a share of the pharmacy market, offering consumers greater convenience ​​​​​​and lower prices. These companies are able to use their large online reach, with Amazon even moving into prescription services and Walmart throwing its hat into the ring, too.

Rite Aid’s financial struggles have been compounded by more than just declining sales and stiff competition. The company’s huge debt and ongoing legal battles pushed it further to the brink. To stabilize during its bankruptcy, Rite Aid obtained court approval for a $200 million in debtbut also agreed to enter into settlement discussions with creditors and individuals suing it over it role in the US opioid crisis.

Meanwhile, Walgreens is also having a tough time. The pharmacy giant said in October that it was on the verge of closing 1,200 stores in the US over the next three years, including 500 locations by fiscal 2025. In June, it said 8,600 locations will be closed in the next few years.

Like Rite Aid, the consequences were dire for Walgreens (WBA-0.62%) customers who rely on pharmacies for prescriptions, especially in areas where options are limited. For customers, the lack of local, reliable pharmacies makes accessing essential medicines more difficult, forcing them to travel long distances or face inconvenience of limited stock and delayed ordersMoody’s (MCO-0.92%) vice president of corporate finance Chedly Louis previously told Quartz.

It’s Rite Aid troubles not unusual. The chain, like the entire pharmacy sector, is facing rising costs, staff shortages, and increased competition. While the chain continues its efforts to recover, it remains to be seen whether it can reinvent itself and ultimately survive.

For now, these “zombie” stores — empty and decaying — may mark the end of an era for Rite Aid.