Rite Aid turns over a new leaf
WHAT IT MEANS AND WHY IT’S IMPORTANT All this really means is that Rite Aid is steady as she goes, because this was the succession plan put into place when John Standley returned to Rite Aid 16 months ago. It also means that if Standley delivers on the promise the board of directors sees in him, Rite Aid won’t be in need of its next CEO for well more than a decade.
(THE NEWS: Standley to assume president, CEO roles at Rite Aid. For the fully story, click here)
Standley was one of four executives originally recruited from Fred Meyer to engineer Rite Aid’s first turnaround. Mary Sammons was another of course, having played a key leadership role at Rite Aid since the turn of the century. And also still active on Rite Aid’s board is Bob Miller, who initially assumed the Rite Aid turnaround project from his CEO position at Fred Meyer.
The fourth former Fred Meyer executive was David Jessick, who stepped out of the Rite Aid day-to-day in 2002 and who also serves on the company’s board.
Once the turnaround at Rite Aid was complete, Standley departed the national pharmacy chain in 2005 and authored his second turnaround — this time Pathmark Stores.
In that time, Rite Aid became the predominant drug chain on the East Coast through its acquisition of Brooks/Eckerd, saddling the company with another large debt load and turnaround task not too long before the economy tanked. So with Standley’s return to Rite Aid, the question always had been can he lay claim to a turnaround success for the third time.
That question’s yet to be answered, of course, but it sure seems so. Rite Aid successfully re-negotiated a substantial portion of its debt in the past year, and that during a time when banks were maybe a little more risk averse than they have been historically. Also in the past year, Rite Aid also successfully steered its stock price back above $1, bringing the public company back into the good graces of NASDAQ and without ever having to resort to a reverse-stock split.
So the banking community and Wall Street investors have both seemed to voice a vote of confidence in Rite Aid. The only remaining voice that counts is the consumer. And Rite Aid will be going a long way to increase its reputation among those stakeholders later this year as it couples a loyalty card program with the host of healthcare offerings already on the chain’s slate.