Today CVS drugstores, the largest revenue chain of drugstores in the US, make big news announcing that they will stop selling tobacco products, a move that is going to cost them about $2 billion in revenues.
That number includes not just lost tobacco sales, but all of the gum, and milk–not to mention medicines for emphysema and lung cancer—that cigarette purchasers would also be buying. Given all the anecdotes about people saying they will go out of their way to shop there, CVS might make some of that up, but I’m guessing the temporary ‘halo effect’ was also figured into their calculations.
As a result of the news, CVS stock went down a percent today. Conversely Rite-Aid and Walmart–where you can continue to buy your carcinogens of choice– went up slightly.
Now CVS didn’t do this just out of the goodness of its heart. It did it because of who it wants to be.
CVS wants to be a health care provider. It’s got Minute Clinics in 800 of its stores–I got a flu shot in one last year—and is planning to nearly double that number over the next couple of years.
Ultimately, of course, it hopes to make more money. And selling cigarettes is absolutely inconsistent with being a health care provider. We can be quite sure that the hospital gift shop doesn’t sell them.
A clear and somewhat rare big news case of a company making a decision about what it wants to be, a decision that has health—some might say moral—implications.
As individuals, though, we do this all the time. My mother refused for years to buy anything made by Nestle until it stopped trying to sell infant formula to Third World mothers.
Why do you buy boxes of Thin Mints and Somoas? For the cookies? Or to that warm fuzzy feeling of supporting the Girl Scouts?
Increasingly U.S. consumers want to know that workers who make our products are not being exploited. Some people buy American cars to support US workers. Buy your books from Amazon or support the little bookshop on main street?
One of these decisions just dropped in my lap, unannounced yesterday. My stockbroker suggested I buy shares in a large spirits company. I could make a lot of money. Almost for sure.
Now I’m not a prude. Truly I’m not. I like an occasional mojito. I think maybe I’ll have one tonight.
But alcohol manufacture really what I want to invest in?
I’ve thought about it for a day. And the CVS thing kind of pushed me over the edge.
Thanks, but no thanks.