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Some 85 per cent of Americans now live within five miles of a CVS pharmacy. The customer focus and attention to detail of CVS co-founder Stanley Goldstein, who has died aged 89, are among the reasons why.
What began with a pair of Consumer Value Stores in Massachusetts in 1963 is now the largest drugstore chain in the US, with more than 9,000 outlets. Parent CVS Health brought in annual revenue of $358bn from pharmacy, healthcare and insurance services in 2023 — more than ExxonMobil or Microsoft.
Goldstein stepped down as CVS chair in 1999 when the chain was already well on the way to ubiquity. Yet while the Rhode Islander was proud of his business achievements, his son Larry told the FT this week that he would “never lead with that in conversation” and came across as an ordinary, sports-mad, dog-loving retiree, rather than a retail magnate. In later years his attitude to the extraordinary success of the group tended to come with “a heavy dose of ‘wow’.”
Retail was in Goldstein’s blood. His father Israel sold paper products to grocery stores, later adding health and beauty aids to the range. After graduating from University of Pennsylvania’s Wharton School of Business in 1955 and serving in the US Army, Goldstein worked for the family enterprise but left to become a stockbroker.
It was only after his brother Sidney asked for his help that Goldstein returned to brainstorm ways to revive the ailing business with Ralph Hoagland, a former Procter & Gamble salesman who had supplied the Goldsteins.
“We looked at nursing homes, roller-skating parks — all sorts of crazy stuff,” Goldstein said in an interview with his local newspaper, the Providence Journal, in 2017.
The trio spotted a gap in the market for standalone stores offering cut-price beauty and health products and opened the first in a low-income area of Lowell, near Boston. The original name was later shortened because, Goldstein explained, “all those letters cost a lot of money” in signage.
The comment was characteristic of his and his co-founders’ approach as they sought any commercial advantage when CVS expanded in the 1960s. The Wall Street Journal described later how the group’s real estate team “fanned out across New England to track traffic patterns, chart shadows (New Englanders favour the sunny side of the street in cold weather), observe commuters using mass transit and make sure the sites were on the side of the street where trolley-car doors open”.
In 1969, seeking funding for further growth, CVS’s owners sold the 40-store chain to retail conglomerate Melville. Stanley continued as president of CVS, rising to chair the entire group in 1987, but slowing growth put Melville under shareholder pressure. Analysts told the Wall Street Journal in 1995 that Goldstein’s “laid-back, professorial approach” was too detached.
The criticism spurred action: when Goldstein took the bold decision that year to break up Melville and focus on CVS, he lit a fire under its expansion plans. CVS listed on the stock market in 1996 and continued to buy rival chains and pick off mom-and-pop pharmacies, which were suffering from changes in US drug pricing and provision.
Yet it was the spirit of the small store-owner that he passed down to his sons Gene and Larry, who have worked together in real estate for 30 years. Larry Goldstein says his father would emphasise the importance of treating the customer well: “It isn’t one transaction, but hopefully it’s a relationship: those are the things that drove him in terms of giving good value.”
Tom Ryan, who took over as CVS chair in 1999, said Goldstein was a humble “servant-leader” before the term became widespread. Goldstein stayed on the CVS board until 2007, but he devoted more time to his philanthropic interests, including his role as founding board president of an innovative high school, the Metropolitan Regional Career and Technical Center, known as The Met. In a tribute, The Met said Goldstein’s “remarkable contributions during the formative years of our school have left an indelible mark on our community”.
Goldstein, who had recently been diagnosed with cancer, is survived by Merle, his wife of 64 years, his two sons and four grandchildren.
Larry Goldstein said: “Many folks knew what he had done in the business world, but that’s not where he would look for his legacy.”
So if he did not introduce himself as one of the men behind CVS, how would Goldstein respond to inquiries about what he did? “He would probably be more interested in what you did.”
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