Rite Aid Tests Co-Branded Stores with Private Label Retailer Save-A-Lot

September 8, 2010

Rite Aid signed a licensing agreement with Save-A-Lot to co-brand 10 existing drug stores in the Greenville, S.C. market to include the discounter's limited assortment grocery and private label lines.

Rite Aid store front Camp Hill, Pa.-based Rite Aid will continue to own and operate the locations, and offer health and beauty products, including its own private label items.

"We believe this new co-branded concept meets the needs of today's consumers, who continue to search for value, quality and convenience, and we're excited about the chance to offer our customers high quality grocery products including fresh meats and farm-fresh produce at great prices," said Ken Martindale, COO of Rite Aid, operator of 4,800 stores in 31 states and the District of Columbia. "We chose to add Save-A-Lot because of its strong sales record, wide selection of attractively priced exclusive brands and its solid reputation for discount grocery. Plus it's a model that's efficient for Rite Aid associates to operate."

The 10-store test is part of the company's “segmentation strategy,” Martindale said, noting that since early 2009, the company has been transitioning from operating all of its stores the same to identifying unique opportunities among like groups of stores.

"This new format –– featuring aspects of both traditional Rite Aid pharmacies and Save-A-Lot food stores –– will provide added convenience and value to consumers in the Greenville, S.C., area," said Bill Shaner, president and CEO of Save-A-Lot, which has 1,200 stores in 39 states. "This relationship is an opportunity for Save-A-Lot and Rite Aid to test a co-branding strategy and the integration of Rite Aid pharmacies into our traditional Save-A-Lot grocery store model."

The stores will remain open as they begin converting to the new format this month and should be complete by October.

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Keywords: private label food, private label trends, rite aid, save-a-lot

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