Walgreens Greets Hawaii

Nov 02, 2007

Mainland drugstore chain Walgreens welcomed its first island shoppers yesterday, when it opened the first of many, many planned stores in the Aloha State. Walgreens is entering a market that has been wholly dominated by California-based Longs Drugs for half a century.

The 9,000-square-foot Keeaumoku store is small and has practically no parking, but is still expected to do brisk business... despite being located across the street from Wal-Mart and a few hundred feet away from Longs Drugs in Ala Moana Center. Indeed, Walgreens has said they are planning to directly target Longs locations with as many as 40 stores here. The next two stores scheduled to open (the former Star Market space in Kaneohe and the former Kam Bowl space in Kalihi) are also within a stone's throw of a Longs store.

Although Longs has over 500 stores in five states, its Hawaii stores generate almost twice as much business as its West Coast locations. But as attractive as the Hawaii market has been, there have been few challengers. Pay n' Save, which became Payless in 1992, gave up its 17 island stores in 1995. Given its aggressive expansion plans in Hawaii and nationwide, it's clear Walgreens is digging in for the long haul.

Walgreens stores will offer some things that Longs stores do not. Drive-thru pharmacies are expected to be a hit (though the Keeaumoku location won't have one), as are in-store snack bars (dubbed "Cafe W") that serve Kona coffee.

Walgreens' entry into the Hawaii marketplace was significant enough to draw the attendance and effusive praise of Gov. Linda Lingle, who cheered the benefits of competition and made passing references to businesses that can no longer "take us for granted."

Walgreens' arrival in Hawaii is part of a wave of new players entering the Hawaii market. Whole Foods is coming, as is Target and Nordstrom.