CVS pharmacy operates under a business model that combines retail

pharmacy services, healthcare services and retail sales. The company is a

part of CVS Health. The retail pharmacy services include prescription

medications with a range of pharmaceutical products and over-the-counter

products. The health care services provided are through MinuteClinic, a retail

medical clinic that provides accessible health care services within the store.

CVS pharmacy also offers screening services. CVS pharmacy is a retail chain

that provides consumer goods which includes beauty and personal care

products, household items, convenience foods, snacks, and seasonal

merchandise. CVS has engaged in strategic partnerships and acquisitions to

expand its offerings. For example, the acquisition of Aetna, a health

insurance company, has allowed CVS to integrate pharmacy services with

broader healthcare services and insurance offerings.

Specialization: Investing in specialized technology and automation for

prescription processing and inventory management. Automation can

enhance efficiency, reduce errors, and lower labor costs associated with

repetitive tasks. Offering specialized training for pharmacists and staff

members to enhance their expertise in specific areas, such as compounding,

specialty medications, or patient counseling. This specialization can improve

the quality of services provided.

Division of labor: Assign specific roles and responsibilities to pharmacy staff,

such as pharmacists, pharmacy technicians, and support personnel.

Specialization allows individuals to become highly skilled in their specific

tasks, leading to increased efficiency. Have pharmacists specialize in

different areas, such as prescription filling, counseling, or managing

inventory. This allows each pharmacist to focus on their specific expertise,

improving overall efficiency.

Advanced technology: Develop and promote user-friendly mobile apps and

online platforms for prescription refills, health information, and general

customer interactions. This can enhance customer convenience, reduce in-

store traffic, and improve operational efficiency. By strategically integrating

several technological advancements, CVS Pharmacy can optimize its

operations, improve customer service, and achieve economies of scale in the

highly competitive pharmaceutical retail industry.

Automation: Implementing robotic systems for prescription filling can

significantly increase the speed and accuracy of dispensing medications and

would reduce the need for manual labor in prescription filling, allowing, for

increased efficiency, faster service, and potential cost savings.

Quantity discount: CVS can negotiate lower per-unit prices with suppliers

when purchasing medications and other products in larger quantities. This

bulk purchasing can lead to direct cost savings.

Of the six (6) ways to achieve economies of scale identified by your classmate's post, which is most feasible for CVS to pursue in increasing economic profit? Why did you choose that way (in letter a. above)? Provide five (5) reasons for your choice using microeconomic and macroeconomic concepts and terms in your response.