Shoppers Drug Mart Corp. expects the recession will last two years, although it doesn't intend to let the poor economy pinch its growth plans, its chief executive officer says.
In a bid to lure customers, the country's largest drug store is increasing the number of its outlets that are open until midnight or around the clock.
"We see us as not, without any doubt, recession proof but quite recession resilient," CEO Jurgen Schreiber told a CIBC World Markets investor conference on Wednesday.
These are "tough times," he added later. "We see it as pain but we see it as opportunity."
The economic downturn isn't pushing Shoppers to change its focus on three main areas: convenience products such as groceries, as well as health and beauty items, he said.
Shoppers has essentially been transforming itself into a hybrid of corner store and department store, carrying a wider array of products in an increasing number of locations.
And it's ensuring that a pharmacist is always on duty when a Shoppers store is open, Mr. Schreiber said.
The chain is expanding the duties that pharmacists can offer as provincial governments loosen the rules tied to the profession, he said. In Western Canada, for example, pharmacists have limited opportunities to re-fill prescriptions without having to get a doctor's approval. Shoppers is preparing its operations to be able to profit from an expansion of these "paid services" in the future, he said.
The company is also offering more private label products, which now represent 17 per cent of sales and will reach 19 per cent by the end of the year, he said.
His decision last year to introduce a low-priced private label, called Everyday Market, has paid off for the company as cash-strapped customers increasingly look for better deals, he added.
And despite the recession, Shoppers plans to boost sales by 7.5 to 9 per cent in 2009 over the previous year, not dramatically different from gains in each of the past few years, he said.
It will continue to add "beauty boutiques" to its stores as it expands its high margin cosmetics and fragrance business. The company opened two high end standalone beauty stores last fall called Murale. The one in Ottawa is a test store and will never make money, but the outlet in Montreal is exceeding the company's targets, he said.
Shoppers is also leaning heavily on its Optimum loyalty card. It has found that Optimum card holders make double the number of shopping trips to Shoppers than non-Optimum members, he said.
In the first half of 2009, the company will launch a corporate credit card that, he said, will not pose a risk for the company.