CVS Health is a pharmacy chain, and a leading healthcare provider in America.
And CVS is a global company that has an online presence in all 50 states.
Seeing the company’s success in America, one may be wondering if CVS is a franchise or what? This article delves into the background and history of CVS pharmacy.
Is CVS A Franchise In 2022?
CVS Health (NYSE: CVS) is a $63 billion retail healthcare company that operates a national network of retail and specialty stores, offering pharmacy, medical clinics, health insurance and customer care services to consumers while employing approximately 500,000 associates nationwide.
If you want to know more about why CVS is a CVS, what the corporate structure of CVS is, who owns CVS, the difference between a franchise and a corporation, and much more, keep on reading!
Why Isn’t CVS A Franchise?
Now after the launch of all the CVS stores have turned into CVS/pharmacies. Many of the old CVS stores have stayed the same but many have been abandoned.
This is because the majority of the shareholders are the main shareholders who own all of the companies.
Being a corporation, CVS gives its customers low prices so that they’ll spend more.
The global economy has started to recover from the 2008 recession and therefore companies are starting to experience growth again.
In the stock market, the shareholders experience more freedom to expand the company and flagship locations through the shareholder model.
When Was CVS Established?
In 1963, the company was established. It operated as ‘Consumer Value Stores’; it was founded by three brothers: Stanley, Sidney, and Ralph Hoagland.
The business started out as a chain of beauty and wellness stores, but soon pharmacies were added, which proved to be a very profitable move.
Finally, in 1996, the Melville Corporation transformed into the CVS Corporation and it acquired a majority interest in Eckerd, Inc.
CVS Health is a pharmaceutical, health care and retail company. The most commonly recognized brand name of CVS, and one of the largest retail organizations in the United States is CVS Pharmacy. However, the company does not own or operate any hospital or clinic facilities, and does not sell insurance.
Who Are The Major Shareholders Of CVS?
As CVS gathered an immense amount of recognition in the U.S. market, a couple of entrepreneurs became attracted to the company and became very interested in its business.
As investors become interested in an enterprise and its success, a high demand among investors is the creation of a positive demand which then creates a strong demand for the enterprise.
[All Original]: The Company may issue up to $1.0 billion in new debt. The Company expects to utilize its existing revolving credit facility and available term loans under its existing credit agreements for these purposes, and will obtain financing on commercially reasonable terms with respect to the amount and timing of such borrowings, if necessary. Additionally, the Company has the ability to issue additional senior secured notes and convertible notes in the open market to satisfy the Company’s debt obligations.
Other than these individuals and investing firms, the remaining CVS shares are owned by other investors.
As an example, the U.S. Department of the Treasury has 7.0% share ownership of the Corporation.
The ownership of the Corporation may be held through various vehicles, including but not limited to those listed above.
The Corporation is a diversified portfolio of investments that may include but is not limited to securities of issuers listed below.
What Is The Difference Between A Franchise And A Corporation?
You can think of the company as being like a house, which is owned by the shareholders and managed by the board of directors, each board member owning his/her own house and being responsible for the house he/she manages.
Additionally, profit and loss must be reported at the accounting level, and distributed throughout the company.
Franchise is owned by the company and those who are running the franchise are called franchisees.
[Franchise]: Franchise is owned by both the company (the franchisor) and an individual running one location (the franchisee).
The company earns all it wants via the franchise fees and after the royalty is paid, the franchisee will distribute the profits to the staff.
Franchise fees are the fee a franchisee pays to the franchisor in exchange for the right to use the franchisor’s corporate identity, trademarks and good will.
Which Store Chains Franchise?
McDonald’s, Subway, and KFC are the most popular franchise companies in the fast-food industry. Other retail franchises are 7-Eleven and Circle K.
The franchise will allow you to become part of their network and have the opportunity to recruit employees and run in a location you may not own. As a note, this does not mean you’ll be able to have a traditional store.
To learn more about the business models of online retailers, you can see our related posts on whether or not Amazon is a franchise, the definition of an ecommerce business model, and if Amazon is an online retailer.
Conclusion
CVS Health is a health care company that primarily provides prescription drugstore services. Its headquarters are in CVS Health Services Corporation, as well as the subsidiaries CVS Caremark and MinuteClinics, CVS Health’s pharmacy and specialty clinics business.
CVS is not a franchise and is unlikely to offer franchising in the future. There are many different ways to franchise, ranging from fast food (McDonalds) to retail marts (7-Eleven).
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