Dive Brief:
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Shipper FedEx and drugstore retailer Walgreen Co. on Wednesday announced an agreement that brings FedEx dropoff and pickup services to Walgreens locations across the U.S.
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As part of the FedEx “Onsite” program, customers will be able to drop off pre-packaged and pre-labeled shipments at Walgreens stores, and pick up packages that they direct to their neighborhood Walgreens.
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Walgreens and FedEx expect to make the program available at thousands of Walgreens locations later this year, expanding chainwide across nearly 8,000 Walgreens stores by the fall of 2018. The launch will begin with an initial, small-scale rollout in the spring.
Dive Insight:
The deal between Walgreens and FedEx is like the one that office supplies retailer Staples has with United Parcel Service. Staples recently agreed to shut down similar United States Postal Service operations following outcry from the postal workers union, abetted by an unfavorable ruling from the National Labor Relations Board.
The move takes advantage of the growth in e-commerce, which has an increasing number of U.S. consumers dealing with the logistics of accepting (and returning) online orders.
“Our research has shown that customers rank pharmacies as a preferred location for accessing their e-commerce shipments,” Raj Subramaniam, executive vice president, chief marketing and communications officer at FedEx Corporation, said in a statement. “The addition of Walgreens locations to the existing network of FedEx retail offerings will substantially increase customer access to staffed pickup and dropoff locations and enhance convenient access to FedEx Ground and FedEx Express package shipment and dropoff options.”
And that could help drive traffic to Walgreens stores, which will increase in number upon the closing of the company's merger with rival Rite Aid, expected to be approved very soon by the Federal Trade Commission. Walgreens Boots Alliance, despite a first quarter sales decline, last week raised the lower end of its guidance for fiscal year 2017 by 5 cents per share in anticipation that the Rite Aid deal will go through.
