Why Don’t Drugstores Have Coffee Shops Anymore

Have you ever wondered why drugstores are no longer offering coffee shops or food service in many locations? It’s a common question, especially from those who remember a time when drugstores had soda fountains and served coffee along with simple breakfast items.

The Evolution of Drugstores

One example that comes to mind is St. Paul Corner Drug. Back in the late 1990s, it was a place where coffee was still relatively cheap, maybe 25 cents, often serving more as a gimmick than a profit driver. Another instance is the downtown Charlottesville, VA store. Nowadays, many drugstores, particularly those in suburban areas, have shifted their focus to convenience and a wider range of products, often seen as overblown convenience stores rather than traditional drugstores.

Historical Comparison: Drugstores with Diners

Drugstores used to offer more than just medicine; they were often hubs for community and convenience. Places like Woolworths boasted long bars with soda fountains, pies, and even burgers that tasted as good as what a parent might make at home. These establishments had a place where families could gather and have a nice meal and even a cup of coffee.

The introduction of fast-food drive-ins and the rise of nationwide chains like McDonald's and IHOP diminished the appeal of drugstores as dining destinations. Drugstores simply couldn’t compete in terms of quality and value. With the advent of chains like Starbucks and IHOP, where people now turn for coffee and breakfast, seeking a more upscale experience, local drugstores found it increasingly difficult to match these standards.

Current Business Model and Profit Margins

Drugstores today have adapted to the changing market. They focus on products like paper goods, soda, candy, toiletries, and cheap cosmetics, which require little to no training for employees. This ensures lower labor costs and allows them to maintain a competitive edge despite the higher customer expectations. The profit margin for these items is higher and more consistent, making it a more viable business model compared to competing with high-end coffee shops.

The physical space required for a coffee shop is substantial, and the return on investment is typically lower. In contrast, drugstores can maximize their space with products that offer higher sales per square foot. Aside from the higher costs associated with running a coffee shop, the regulations surrounding food service are much stricter, making it less attractive to the majority of drugstore owners.

In conclusion, the shift away from drugstores offering coffee shops is primarily due to the current business model, profit margins, and the lack of viable space for such enterprises. As customers’ preferences have evolved, the convenience and cost-effectiveness of traditional drugstores have become more appealing, solidifying their position in the market despite the nostalgia for a bygone era of combination drugstores and diners.