NEW YORK If there were to be a beginning point identified for Rite Aid’s latest turnaround effort, this time encompassing all of what was once the No. 4 national drug chain in Eckerd, it may have happened in the few months prior to September 2008, when Rite Aid’s brass was still recruiting John Standley.
Now Standley is again a critical part of the Rite Aid team as president and COO, along with a pair of other “turnaround experts” in Frank Vitrano and Ken Martindale. That means Rite Aid has many of the same executive pieces-to-the-puzzle that engineered Rite Aid’s last turnaround between 2000 and 2005, that being the turnaround that put Rite Aid in a position to even consider the Brooks/Eckerd acquisition in the first place.
Bob Miller still is available as a brain trust to Rite Aid as board member; and chairman and CEO Mary Sammons still is leading the charge.
You might even be able to make the case that this current turnaround will be a lot easier to pull off as compared with the last. Vendor relations are considered a relative strong suit for the company today, a factor that wasn’t necessarily the case prior to Miller and Co. assuming control of Rite Aid back at the turn of the century. And while Jim Mastrian, credited with creating a culture where vendor relations flourished, may have recently retired, SVPs Jerry Cardinale and Bryan Shirtliff are still bearing that standard — incidentally, two executives who were likewise part of the executive team that turned Rite Aid positive on the first go-around.
And there’s also less to actually turn around — almost half of the company is made up of core Rite Aid stores that were performing well before the acquisition.
Rite Aid also has a few new executives around which to build that future success. In addition to Vitrano and Martindale — both Pathmark vets — there’s Brian Fiala, a 24-year veteran of Target, in charge of overall store operations.
So what does it all mean? It all means that Rite Aid has taken some significant strides in maintaining its viability in the past three quarters, which is when Standley and Vitrano first stepped on board and were soon followed by Martindale. And it means there is a certain confidence that Rite Aid will continue moving in this positive direction, as evidenced by the improving trends across several metrics — SG&A, same-store sales trends, overall prescription counts and improved liquidity.