Rite Aid onboards new CIO as it flirts with bankruptcy
- Rite Aid named Justin Mennen as its SVP and CIO, reporting to SVP and CFO Darren Karst, according to a company announcement.
- The drug store is looking to Mennen to modernize its infrastructure and improve customer and associate experiences. Rite Aid's former CIO, Steve Rempel, left earlier this year to serve as CIO for Walgreens Boots Alliance.
- Mennen most recently served as CIO and CDO for CompuCom since 2016. His previous roles included VP of enterprise architecture and technology innovation for Estée Lauder and regional CIO for Asia Pacific and Japan at Dell, according to his LinkedIn.
Rite Aid has had two failed mergers in just three years. And while competitors like CVS and Walgreens have found their edge, Rite Aid is struggling to keep pace.
"Customer expectations and new technology advances from our competitors have required that our business evolve so that we are able to interface with our retail customers," said Rite Aid's 10-K report for FY18, in stores, online and in mobile applications.
The drug stores are all integrated into a singular information system, according to the 10-K report. It has developed a workload sharing technology which aids stores in close proximity to alleviate filling volumes.
Rite Aid has an opportunity to undergo much needed transformation, following a $352.3 million net loss for Q2, after an income of $188.4 million last year.
At the time of the earnings call, John Standley, CEO, said the company's goal was to "take out $96 million of cost as we better align our organization to our new store footprint." The chain is pursuing omnichannel capabilities to improve customer experiences in stores.
Investing in technology will serve as a gateway to improve Rite Aid's current standing. CreditRiskMonitor, a tool that estimates the chances of a company (with publicly traded debt or bonds) filing for bankruptcy in a 12-month period, gave Rite Aid a "FRISK" score of two on the tool in November, which indicates a 4% to 9.99% chance of bankruptcy.
Rite Aid received a "FRISK" score of two on the tool, which indicates at 4% to 9.99% chance of bankruptcy, reports Retail Dive. It attempted to merge with Walgreens though plans fell through last year. Walgreens did acquire 2,000 Rite Aid locations, but subsequently plans to close 600 of them.
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