CVS Is Opening Pharmacy-Only Stores in Select Communities

CVS is downsizing, but not in the way you might think. The healthcare chain is pushing the idea to open smaller store formats that offer only pharmacy services.

With increased competition and the need to reduce costs, CVS is taking a different approach to expanding its footprint. The company will open several new, smaller locations in select areas starting this year.

Compared with the full-size locations that sell food and self-care products, the new stores will offer only over-the-counter medications and prescriptions. Each store will be customized based on the surrounding community and average under 5,000 square feet in size.

“By taking a customized approach to our footprint that is focused on the specific needs of the communities we serve, we’re continuing to strategically realign our pharmacy footprint to better support patient and ensure the right geographic coverage,” a company spokesperson told FOX Business. 

While the small-format locations will open up new opportunities for CVS, it hasn’t given up on the traditional, larger stores just yet. The drug retailer still intends to open about 30 other locations this year — some will be inside Target stores while others will include both a pharmacy and full storefront like the typical, brick-and-mortar CVS.

Why Is CVS Opening Small Stores?

CVS’s most recent earnings report may suggest the company sees an opportunity to maintain the growth momentum of its pharmacy services. Income for the pharmacy and consumer wellness division climbed 7% to $33.51 billion in the fourth quarter of 2024. The company credited higher prescription volume for the increase.

The opening of pharmacy-only locations could also improve the CVS experience. Patients can come in and get prescriptions or other medications quickly and conveniently.

Many drugstores, like CVS, have been forced to lock up products to deter theft, which is often frustrating to customers looking to buy an item or two and check out. Instead of asking for assistance, many customers simply walk out without purchasing.

With a smaller store concept without grocery and convenience items, CVS will no longer need to commit resources to that side of retail. Not having a convenience store attached to the pharmacy means the company will not need as many employees, saving any costs associated with staffing. It also eliminates the need to compete against other small stores like 7-Eleven that sell similar convenience-type items.