Community bad will a curious business strategy for Walgreens

I don’t claim expertise in business strategy, but I’m baffled by the move of Walgreens to force the popular Foodland supermarket out of the Koko Marina Center in Hawaii Kai to open its own drug store that nobody seems to be clamoring for.

Walgreens reportedly paid a 15 percent premium to wrest away the space Foodland has held for more than 40 years. Walgreens doesn’t even need all the space and is looking to sublease a piece of it — possibly back to Foodland for a much smaller market.

With Foodland closed for now, residents are outraged at their reduced grocery options and many are promising to boycott the Walgreens.

It’s difficult to see the sense of paying a hefty premium to buy a lot of bad will that could take years to overcome in a community of established residents with long memories. Surely there must have been other space available.

Walgreens has been agressive since moving into Hawaii, often opening stores right in the face of its biggest competitor Longs, an established island institution.

On the Windward side where I live, Walgreens has opened two stores near Longs and from my observations doesn’t seem to be getting nearly the traffic of the competition. It doesn’t help that the Walgreens stores have been picketed by construction unions over the wages they pay.

Maybe it’ll all pay off in the long run, but I’m not seeing how so far.

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3 Comments on “Community bad will a curious business strategy for Walgreens”

  1. zzzzzing Says:

    Most people I’ve talked to just ignore the die-hards standing out in front of Walgreens. That said, I still go to Long’s. One employee told me that CVS is “learning to change” after taking over Long’s here – nothing like the mainland stores.

    I think Walgreen’s move is rather bone-headed, though. Guess time will tell if a boycott will be successful.

  2. robert Says:

    funny you describe Long’s as an island “institution”, b/c there are a lot of institutions in this state that aren’t very good. and i’d put Long’s into that category for their Long’s lines, marginal service (it was better), and expensive choices…

  3. hipoli Says:

    I have heard, though unconfirmed, that Walgreens is having environmental-problems with their plans at the Nuuanu location, namely the huge tree coming out of Hungry Lion is historic and protected, so they cant tear down the building & replace it, as originally planned.

    Can anyone substantiate this?

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