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Revco Discount Drug Stores (known simply as Revco or Revco, D.S.), once based in
Twinsburg, Ohio Twinsburg is a suburban city in Summit County, Ohio, United States, located about halfway between Akron and Cleveland. The population was 19,248 as of the 2020 census. It is part of the Akron metropolitan area. History In 1817 Ethan Alling, then ...
, was a major
drug store A pharmacy (also called "drugstore" in American English or "community pharmacy" or "chemist" in Commonwealth English, or rarely, apothecary) is a retail shop which provides pharmaceutical drugs, among other products. At the pharmacy, a pharmacis ...
chain operating through the
Ohio Valley The Ohio River is a long river in the United States. It is located at the boundary of the Midwestern and Southern United States, flowing southwesterly from western Pennsylvania to its mouth on the Mississippi River at the southern tip of Illinoi ...
, the Mid-Atlantic states, and the
Southeastern United States The Southeastern United States, also referred to as the American Southeast or simply the Southeast, is a geographical region of the United States. It is located broadly on the eastern portion of the southern United States and the southern por ...
. The chain's stock was traded on the
New York Stock Exchange The New York Stock Exchange (NYSE, nicknamed "The Big Board") is an American stock exchange in the Financial District of Lower Manhattan in New York City. It is by far the world's largest stock exchange by market capitalization of its listed c ...
under the
ticker symbol A ticker symbol or stock symbol is an abbreviation used to uniquely identify publicly traded shares of a particular stock on a particular stock market. In short, ticker symbols are arrangements of symbols or characters (generally Latin letters ...
RXR. Revco was sold to
CVS Pharmacy CVS Pharmacy, Inc. is an American retail corporation. A subsidiary of CVS Health, it is headquartered in Woonsocket, Rhode Island. It was also known as, and originally named, the Consumer Value Store and was founded in Lowell, Massachusetts, in ...
for $2.8 billion in February 1997. When it was sold, the chain had over 2,500 stores.


History

Revco, originally known as Registered Vitamin Company, was founded in 1956 in Detroit, Michigan, by Sidney Dworkin and Bernie Shulman. Dworkin led Revco until 1986 as
CEO A chief executive officer (CEO), also known as a central executive officer (CEO), chief administrator officer (CAO) or just chief executive (CE), is one of a number of corporate executives charged with the management of an organization especially ...
, and then he served as
chairman The chairperson, also chairman, chairwoman or chair, is the presiding officer of an organized group such as a board, committee, or deliberative assembly. The person holding the office, who is typically elected or appointed by members of the grou ...
until 1987. Up to 1983, Revco grew tremendously; the chain had over 2,200 stores and over $2.2 billion in sales. The chain then began to stumble. In 1983, its vitamins were blamed for the deaths of a number of premature infants. In order to prevent a
hostile takeover In business, a takeover is the purchase of one company (the ''target'') by another (the ''acquirer'' or ''bidder''). In the UK, the term refers to the acquisition of a public company whose shares are listed on a stock exchange, in contrast to ...
and increase short-term profitability, Dworkin then led the chain into a deal that would seal its fate many years later. Under his leadership, Revco purchased a company called Odd Lot Trading Co., a closeout retailer based in New Jersey. Revco's management lost its focus on the drug store portion of its business due to problems with Odd Lot Trading Co., and earnings tumbled. The chain also began to merchandise items such as televisions, furniture, and other non-core items, and the heavy investment proved to be a failure.


Bankruptcy

In 1986, Revco was the target of a
leveraged buyout A leveraged buyout (LBO) is one company's acquisition of another company using a significant amount of borrowed money (leverage) to meet the cost of acquisition. The assets of the company being acquired are often used as collateral for the loan ...
. Part of the buyout deal was to reduce costs by closing stores and by reducing inventory to repay debts. This left the company with a shortfall of cash, and suppliers stopped shipping inventory, causing the chain to lose customers. This eventually caused the chain to file for
bankruptcy Bankruptcy is a legal process through which people or other entities who cannot repay debts to creditors may seek relief from some or all of their debts. In most jurisdictions, bankruptcy is imposed by a court order, often initiated by the debtor ...
in 1988. Revco was bailed out of bankruptcy by investor
Sam Zell Samuel Zell (born Shmuel Zielonka, September 28, 1941) is an American billionaire businessman and philanthropist. A former lawyer, Zell is the founder and chairman of Equity Group Investments, a private investment firm, founded in 1968. He has ...
, in part to fend off separate takeover attempts by both Eckerd and
Rite Aid Rite Aid Corporation is an American drugstore chain based in Philadelphia, Pennsylvania. It was founded in 1962 in Scranton, Pennsylvania, by Alex Grass under the name Thrift D Discount Center. The company ranked No. 148 in the Fortune 500 lis ...
. In 1990, 221 Midwest Revco stores were purchased by Reliable Drug, based in Cleveland, OH. The Michigan stores purchased by Reliable were sold almost immediately to Perry Drugs. Revco emerged from bankruptcy, as an independent company, in 1992.


Emergence from bankruptcy

Revco's turnaround from bankruptcy was and is often still considered the "model" of a business recovering from bankruptcy. The chain closed many underperforming stores (including selling all stores west of the Mississippi River to the son of the then-current Rite Aid CEO), reduced costs, introduced computerized
point-of-sale The point of sale (POS) or point of purchase (POP) is the time and place at which a retail transaction is completed. At the point of sale, the merchant calculates the amount owed by the customer, indicates that amount, may prepare an invoice f ...
systems, and introduced a new store design to help increase sales. The chain shrank from about 2,200 stores to about 1,500 stores during this period. The hallmark of the new store designs was the arrangement of the store aisles, which was developed and introduced as the company was emerging from bankruptcy. Half the store had aisles that ran from the front of the store to the back in straight rows. Seasonal merchandise, food,
greeting card A greeting card is a piece of card stock, usually with an illustration or photo, made of high quality paper featuring an expression of friendship or other sentiment. Although greeting cards are usually given on special occasions such as birthday ...
s, baby supplies, hardware and office supplies were in this half of the store. The other half of the store, the health and beauty sections, had their aisles slanted so customers could see down the aisles as they walked from the front doors to the pharmacy, which was in the back of the store. A very wide main aisle led from the front door to the pharmacy, and this aisle separated the slanted aisles from the "straight aisles". While many drug stores in the U.S. have variations of this design today, it was a departure at the time from the usual all front-to-back, straight aisles. In Revco's free standing stores, the slanted aisles had an open ceiling above them; the other aisles had a
drop ceiling A dropped ceiling is a secondary ceiling, hung below the main (structural) ceiling. It may also be referred to as a drop ceiling, T-bar ceiling, false ceiling, suspended ceiling, grid ceiling, drop in ceiling, drop out ceiling, or ceiling tile ...
over them. In these stores today, which are now CVS stores, the open ceiling and drop ceiling are still in place (though all the aisles are now aligned in a traditional manner). The new stores also were decorated in soft blues and greys, had track lighting, and low hanging lights over the greeting cards, all which gave the store a "soft" appearance. Revco introduced strict rules about having no handwritten signs or merchandise displays sitting directly on the floor, which it thought gave the stores a cleaner look. It also required its employees to dress extremely professionally, with men wearing ties. All front-end employees had to wear a navy blue smock. After emerging from bankruptcy, the chain grew tremendously again, increasing its store count to over 2,500 stores. Part of this growth came from the purchase of over 800 Hook's/SupeRx drug stores in 1994 in the Mid-Atlantic region and Midwest, and
Birmingham, Alabama Birmingham ( ) is a city in the north central region of the U.S. state of Alabama. Birmingham is the seat of Jefferson County, Alabama's most populous county. As of the 2021 census estimates, Birmingham had a population of 197,575, down 1% fr ...
, based
Big B Drugs Big B, Inc. was a Birmingham, Alabama-based drugstore chain. The company began operation in 1968 as division of Birmingham based Bruno's Supermarkets. Most of its stores were located next to a Bruno's, Food World or FoodMax. Big B also operated ...
in the southeast, which was its last purchase, made in 1996.


Sale of the company

In order to help Zell recover his investment in the company, the company's management was under pressure to sell the company. In 1996, Revco entered into an agreement with
Rite Aid Rite Aid Corporation is an American drugstore chain based in Philadelphia, Pennsylvania. It was founded in 1962 in Scranton, Pennsylvania, by Alex Grass under the name Thrift D Discount Center. The company ranked No. 148 in the Fortune 500 lis ...
to be bought out. The
Federal Trade Commission The Federal Trade Commission (FTC) is an independent agency of the United States government whose principal mission is the enforcement of civil (non-criminal) antitrust law and the promotion of consumer protection. The FTC shares jurisdiction ov ...
(FTC) announced that it would sue to stop the buyout, saying that Rite Aid would become a
monopoly A monopoly (from Greek language, Greek el, μόνος, mónos, single, alone, label=none and el, πωλεῖν, pōleîn, to sell, label=none), as described by Irving Fisher, is a market with the "absence of competition", creating a situati ...
in many markets because Rite Aid and Revco had many overlapping stores, and Rite Aid withdrew its bid for the company. In February 1997,
CVS Pharmacy CVS Pharmacy, Inc. is an American retail corporation. A subsidiary of CVS Health, it is headquartered in Woonsocket, Rhode Island. It was also known as, and originally named, the Consumer Value Store and was founded in Lowell, Massachusetts, in ...
entered into an agreement to acquire Revco, but the FTC moved to block the acquisition under the
Clayton Act The Clayton Antitrust Act of 1914 (, codified at , ), is a part of United States antitrust law with the goal of adding further substance to the U.S. antitrust law regime; the Clayton Act seeks to prevent anticompetitive practices in their incipie ...
on the ground that it would substantially reduce competition in two markets: the state of
Virginia Virginia, officially the Commonwealth of Virginia, is a state in the Mid-Atlantic and Southeastern regions of the United States, between the Atlantic Coast and the Appalachian Mountains. The geography and climate of the Commonwealth ar ...
and the Binghamton, New York metropolitan statistical area. In response, CVS and Revco agreed that 114 of Revco's Virginia stores and six of its Binghamton-area stores would be divested. The companies entered into a consent order with the agency, under which it was agreed that the Virginia-area stores would be
divest In finance and economics, divestment or divestiture is the reduction of some kind of asset for financial, ethical, or political objectives or sale of an existing business by a firm. A divestment is the opposite of an investment. Divestiture is a ...
ed to
Eckerd Corporation Eckerd Corporation was an American drug store chain that was headquartered in Largo, Florida, and toward the end of its life, in Warwick, Rhode Island. The chain had approximately 2,800 stores in 23 states as far west as Arizona. In November 199 ...
and the Binghamton stores would be divested to Medicine Shoppe, Inc. As part of executing the divestiture to Eckerd, the FTC alleged that CVS removed important computers and pharmacy files from the divested stores, and that CVS denied Eckerd access to Revco's computerized patient profile data, providing the data only on
microfiche Microforms are scaled-down reproductions of documents, typically either films or paper, made for the purposes of transmission, storage, reading, and printing. Microform images are commonly reduced to about 4% or of the original document size. F ...
, which would require Eckerd to manually re-enter the data, impairing Eckerd's ability to compete. CVS was fined $600,000 for the violation. Apart from the FTC penalty, CVS paid a $1.58 million fine to the Virginia Board of Pharmacy for violating state regulations governing the transfer of patient prescription records.


CEOs

* Sidney Dworkin (1961–1986) * William Edwards (1986–1987) * Boake Sells (1987–1992) * D. Dwayne Hoven (1992–1997, last CEO)


Promotions and discount programs

Revco was well known for the slogan "You need all the Revco you can get!" and its "A Friend for Life" slogan and senior citizen's discount program, called "Senior Shoppers" (in which customers over 65 received 10% off their purchase every Wednesday). Revco also had a discount program for customers with disabilities (called "Helping Hands") and for baby supplies (called "Baby Bunch"). At the time, it was highly unusual for a chain of Revco's size to offer such discount programs, and the chain was extremely popular with customers because of these programs. Revco may have been well ahead of its time, as its discount programs resembled today's
loyalty card A loyalty program is a marketing strategy designed to encourage customers to continue to shop at or use the services of a business associated with the program. Today, such programs cover most types of commerce, each having varying features and ...
programs used by
grocery stores A grocery store ( AE), grocery shop ( BE) or simply grocery is a store that primarily retails a general range of food products, which may be fresh or packaged. In everyday U.S. usage, however, "grocery store" is a synonym for supermarket, an ...
and CVS. Revco had customers fill out an information card with their contact information and gave them a card to identify their participation in the discount program (though Revco did not track purchases as many loyalty card programs do today). Revco used gymnast
Mary Lou Retton Mary Lou Retton (born January 24, 1968) is an American retired gymnast. At the 1984 Summer Olympics in Los Angeles, she won a gold medal in the individual all-around competition, as well as two silver medals and two bronze medals. Her performanc ...
as an advertising spokesperson in the 1990s, who often began commercials by saying, "And another thing..." and would end them by saying, "...and now you know. Revco." Rite Aid now offers a similar discount program to "Senior Shoppers", called "Living More". This may be because Rite-Aid's James P. Mastrian, who is the Executive Vice President of
Marketing Marketing is the process of exploring, creating, and delivering value to meet the needs of a target market in terms of goods and services; potentially including selection of a target audience; selection of certain attributes or themes to emph ...
, held the same position at Revco from 1994 to 1997. Twins Days, a festival honoring the twin brothers who founded the city of
Twinsburg Twinsburg is a suburban city in Summit County, Ohio, United States, located about halfway between Akron and Cleveland. The population was 19,248 as of the 2020 census. It is part of the Akron metropolitan area. History In 1817 Ethan Alling, then ...
, was the brainchild of Charles R. DeHaven, then Revco's Assistant Vice President of
Public Relations Public relations (PR) is the practice of managing and disseminating information from an individual or an organization (such as a business, government agency, or a nonprofit organization) to the public in order to influence their perception. P ...
. DeHaven planned a number of promotional events in 1976 to commemorate the nation's bicentennial. From the small gathering of 37 sets of
twins Twins are two offspring produced by the same pregnancy.MedicineNet > Definition of TwinLast Editorial Review: 19 June 2000 Twins can be either ''monozygotic'' ('identical'), meaning that they develop from one zygote, which splits and forms two em ...
that first year, the festival now attracts thousands from all over the world and makes national headlines every summer.


Prescription Access Link

Revco was one of the first drug store chains in the country to have a centralized pharmacy computer system, which it called Prescription Access Link (PAL). This system allowed each Revco access to any other Revco's prescription information. It highly advertised this system to customers, which allowed a customer to go any Revco to have their prescription refilled without the stores having to call each other on the phone. While this type of system is the norm in drug stores today, it was revolutionary when Revco used it. PAL was introduced to Revco stores during its emergence from bankruptcy.


In popular culture


The Revco Marathon

Revco founded and sponsored a
marathon The marathon is a long-distance foot race with a distance of , usually run as a road race, but the distance can be covered on trail routes. The marathon can be completed by running or with a run/walk strategy. There are also wheelchair div ...
in
Cleveland Cleveland ( ), officially the City of Cleveland, is a city in the U.S. state of Ohio and the county seat of Cuyahoga County. Located in the northeastern part of the state, it is situated along the southern shore of Lake Erie, across the U.S. ...
, which was often referred to among runners as "The Revco" (its full name was " The Revco Cleveland Marathon and 10K"). The first race took place in 1976, when
jogging Jogging is a form of trotting or running at a slow or leisurely pace. The main intention is to increase physical fitness with less stress on the body than from faster running but more than walking, or to maintain a steady speed for longer periods ...
/running first became a national fitness craze. Famous Olympic athlete
Jesse Owens James Cleveland "Jesse" Owens (September 12, 1913March 31, 1980) was an American track and field athlete who won four gold medals at the 1936 Olympic Games. Owens specialized in the sprints and the long jump and was recognized in his lifet ...
fired the starting gun at the first race, which started at
Western Reserve Academy , motto_translation = Light and Truth , address = 115 College Street , city = Hudson , state = Ohio , zipcode = 44236-2999 , country = United S ...
in Hudson, Ohio, wound its way up Rt. 91 north through Twinsburg and Solon, and eventually ended in Cleveland. This particularly grueling course was changed in later years to begin and end at
Cleveland State University Cleveland State University (CSU) is a public research university in Cleveland, Ohio. It was established in 1964 and opened for classes in 1965 after acquiring the entirety of Fenn College, a private school that had been in operation since 1923. ...
. Many famous runners participated over the years, as "The Revco" became an Olympic qualifying event. After CVS bought Revco, the race became known as the "CVS Marathon and 10K" before CVS dropped its sponsorship in the early 2000s. The race was sponsored by Rite Aid until 2021, when Union Home Mortgage became the primary sponsor.


References


Revco, D.S.


Footnotes

{{CVS Health Retail companies established in 1956 Defunct pharmacies of the United States Companies based in Ohio Private equity portfolio companies Retail companies disestablished in 1997 Defunct companies based in Ohio CVS Health Health care companies based in Ohio 1956 establishments in Michigan 1997 disestablishments in Ohio Summit County, Ohio American companies established in 1956 American companies disestablished in 1997