WOOLWORTHS and private hospital group Netcare have pulled the plug on a three-year project to test the demand for upmarket retail pharmacy outlets. The pharmacies situated in Woolworths stores that opened in Kloof Street, Cape Town, and Athol Square in Johannesburg, in 2007, and one that opened in Eastgate Mall in Johannesburg last year, would close at the end of next month, the two companies said. Zyda Rylands, Woolworths MD for food, said pharmacies were an innovative idea at the time but Woolworths now had other retail priorities and, unfortunately, pharmacy was not one of them. Netcare CEO Richard Friedland agreed, saying a venture of this nature was not core to the business of Netcare. Pricing regulations prevent pharmacies from being money spinners, but they do attract customers to stores. Woolworths' rival, Spar, said this month it would open its first branded pharmacy in Shelly Beach, KwaZulu-Natal, next month. Shoprite has 100 pharmacies in its stores. Woolworths and Netcare said the pilot pharmacies, which targeted "customers who placed a premium on the value of their time", had dispensaries stocked, staffed and managed by Netcare, while over-the-counter health, wellness and beauty products were supplied and managed by Woolworths, but the response was weaker than expected.

Michael Bleby: Business Day, 24 May 2010