Walgreens is in trouble. And that means trouble for Chicago.
The Deerfield-based pharmacy giant, having lost about three-quarters of its market value since the beginning of 2022, is embarking on a major turnaround plan, which will entail the closure of hundreds of stores nationwide if not well over 1,000. Fully a quarter of Walgreens’ roughly 8,500 stores in the 50 states, the District of Columbia and U.S. territories are unprofitable, the company shockingly disclosed last week. Walgreens plans to shutter a healthy portion of those, although the precise number is to be determined.
This is potentially terrible news for Chicago, and not just because Walgreens is the region’s largest locally based public corporation. Chicago has by far the most Walgreen stores of any city in the nation, with 111 of them. Houston is next on the list with 98.
More importantly for Chicago, Walgreens is one of the only major retail outlets left in a large number of low-income neighborhoods that have watched other retail chains flee. If Walgreens were to exit those communities, the blow would be tremendous. In neighborhoods like Englewood on the South Side and North Lawndale on the West Side, Walgreens is a critical anchor and typically the only retailer of its kind. It functions often as an important source of groceries (including fresh food like milk and cheese) in addition to the prescription and over-the-counter medications it dispenses.
But the drugstore chain is in something approaching crisis. Earnings are falling, the company’s past efforts at diversifying its profit sources have faltered and CEO Tim Wentworth, hired last year to fix the business, has determined that a back-to-basics approach is needed. He also has decided that Walgreens has far too many stores. His difficult decision to close a healthy chunk of the many laggards is perfectly rational.
If only Chicago cared about crime.
