Retail clinics begin closing

While nobody's suggesting that the retail clinic market is about to dry up and blow away, signs continue to suggest that its first major growth phase is at an end--and that it's not going to be as easy for smaller players to enter as it has been in the past.  The biggest sign of this is the fact that there's been a rash of clinic closings of late, including the following:

*  44 outlets have closed in Wal-Mart stores, under the brands SmartCare, My Healthy Access and Checkups.

*  Seven MedBasics Family Health Centers closed in Texas and Arkansas.

*  MinuteClinic closed three Minnesota outlets, each freestanding, to focus on its CVS-based outlets.

Analyst firm Merchant Medicine, which focuses on retail clinics, is arguing that the industry is "close to saturation" and predicts that execs are going to be "more thoughtful" about where they expand. I'd argue that this is a mischaracterization, however, I believe execs have been trying out business models and are now pulling back, in some cases two years into the game, when it becomes clear that one variation of the business model doesn't pull as well. While there seems to have been some rash expansions, particularly in the case of CheckUps, the industry has otherwise built in a steady fashion.

When it comes to retail clinics, look for pharmacy rather than other retail-based clinics to advance, and affiliations with existing healthcare players (especially hospital systems) rather than deals with independent players. However, don't expect independent players to go away. Slow and steady players should still be able to build quite a nice business if they move slowly. Retail clinics are entering the next growth phase.

To learn more about this trend:
- read this Minneapolis Star-Tribune article

Related Articles:
Resource Center: Retail Clinics
Start-up closes 23 Wal-Mart retail clinics
Expansion of retail clinics slowing
SLIDESHOW: Common retail clinic locations

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