SWOT ANALYSIS ON Express Scripts -
November 30th, 2010
Express Scripts, Inc. (NASDAQ: ESRX) is a Fortune 100 company headquartered in Cool Valley, Missouri. It began in 1986 in St. Louis, Missouri as a result of a joint venture between a retail chain of more than 79 pharmacies (Medicare Glaser Inc.) and Sanus Corp. Health Systems. Express Scripts was purchased by New York Life Insurance Company in 1989 and became a publicly traded company in 1992. Through expansion of its client base, product lines and several acquisitions (ValueRx, Diversified Pharmaceutical Services, and National Prescription Administrators (NPA)) Express Scripts currently employs over 14,000.
Express Scripts is a pharmacy benefit manager. The company processes pharmaceutical claims for members at network pharmacies and at their own mail order pharmacies. They provide services to manage drug plans for government agencies (both as administrator of employee benefits and public assistance programs), corporations, and unions. One of their largest clients is the United States Department of Defense's TRICARE program.
* Understands Hispanic shoppers better than anyone else in retail
* Banner segmentation serves a wide arrange of shoppers (Central Market, HEB Plus, HEB, HEB Hybrid, Pantry Foods, Mi Tienda)
* Strong private label program
* Serves markets with high population growth
* Strong diversity
* Certain stores require a lot of labor (i.e., Central Market)
* Operates only in one state in the US (Texas)
* Lack of a loyalty card
* Privately owned company - no access to capital from capital markets
* Continue to grow its market share
* Increase fresh food sales
* Leverage learnings across banners
* Mexico expansion
* Private label growth
* Pressure from smart retailers (Wal-Mart, Kroger)
* Saturation in key markets
* No loyalty card data puts them at a disadvantage vs. other grocers
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