Thrifty PayLess

Thrifty PayLess Holdings, Inc. was a pharmacy holding company that owned the Thrifty Drugs and PayLess Drug Stores chains in the western United States. The combined company was formed in April 1994 when Los Angeles-based TCH Corporation, the parent company of Thrifty Corporation and Thrifty Drug Stores, Inc., acquired the Kmart subsidiary PayLess Drug Stores Northwest, Inc.^[1] At the time of the merger, TCH Corporation was renamed Thrifty PayLess Holdings, Inc. and Thrifty operated 495 stores, PayLess operated 543 stores.

In 1996, Rite Aid acquired 1,000 West Coast stores from Thrifty PayLess Holdings, creating a chain with over 3,500 drug stores.^[2]

History of PayLess

Logo for PayLess Drug Stores.

In 1932, L.J. Skaggs opened Payless Drug Stores in Tacoma, Washington, which soon expanded across the western United States. Some stores were sold to his brother Samuel "L.S." Olnie Skaggs (then an executive at Safeway) along with some colleagues. L.J. Skaggs retained California PayLess Stores, which eventually became part of Thrifty PayLess. The remaining PayLess stores were renamed Skaggs Drug Stores in 1948, and Skaggs Drug Centers in 1965.

Peyton Hawes and William Armitage acquired a controlling interest in five drug stores in three communities in Oregon and Washington, which were named PayLess, and grew their chain through both acquisition and internal expansion. By 1984, PayLess Drug Stores was the largest independently owned and operated drug store chain in the United States. It became a wholly owned unit of Kmart in 1985,^[3] as part of the Kmart expansion program created by CEO Joseph Antonini. In 1986, there were 225 PayLess stores. By 1990, PayLess operated in nine western states. Today, a new Payless Drugs (using a similar logo to the prior PayLess), operates as a long-term healthcare pharmacy but does not operate retail stores.

Acquisitions

• 1973 - Acquired Seattle-based House of Values and Portland-owned Gov-Mart Bazaar to form PayLess House of Values.
• 1976 - PayLess bought 22 Value Giant stores, the majority of which were located in Northern California.
• 1980 - PayLess acquired PayLess Drug Stores of Oakland, California, founded by Levi Justin Skaggs.
• 1987 - PayLess purchased 25 Osco Drug stores in California, Idaho, Oregon, and Washington.
• 1990 - Acquired Pay Less of Tacoma, Washington.

History of Thrifty

Thrifty was large enough to have their own brand of products.

In 1919, brothers Harry and Robert Borun, along with brother-in-law Norman Levin, founded Borun Brothers, a Los Angeles, California, drug wholesaler. By 1929, the brothers opened their own Los Angeles retail outlets under the name Thrifty Cut Rate. The first store was located at 412 S. Broadway in downtown Los Angeles, just across the street from the original Broadway Department Store.^[4]

After opening five additional downtown area stores,^[5] Thrifty opened their seventh store in the then recently completed Pellissier Building in the Mid-Wilshire district, on Wilshire Boulevard and Western Avenue, in 1931. This was their first store outside of downtown,^[6] and it was quickly followed by several new stores within a few miles of downtown.

By 1942, Thrifty Drug Stores operated 58 stores. By the time their 100th store opened in Studio City in 1950,^[7] Thrifty ranged as far north as Santa Rosa, California, and as far south as San Diego. Thrifty soon expanded outside California, opening a Las Vegas location in 1952.^[8] In 1959, the chain expanded into the Pacific Northwest with a store in Eugene, Oregon.^[9][10]

Store grand opening events were always a large spectacle, with politicians as well as movie and television celebrities involved in the ceremonies. Actor Errol Flynn participated in the 1941 opening of the South Pasadena store.^[11]

A neon Thrifty Drug Store sign is visible in the background of a scene from the 1954 Judy Garland version of A Star Is Born.

During the 1950s, a Thrifty commercial jingle played on numerous radio stations in Southern California:

Save a nickel, save a dime.
Save at Thrifty every time.
Save a dollar and much more,
at your Thrifty Drug Store!^[1]

1. ^ Walker, Joe (October 2009). "Looking Back". Boulevard Sentinel 13 (6). 

Until the early 1980s, every Thrifty store featured a tube tester, usually located near the cosmetics display case. Vacuum tubes were still used in a wide variety of consumer electronics such as TVs and radios, and the local Thrifty store was a convenient place to test them and purchase replacements. Thrifty published a brochure helping customers diagnose which tubes might be responsible for various TV malfunctions. The brochure also provided numbered stickers to aid consumers in reinstalling working tubes in their correct sockets.

In the early 1970s, Thrifty's parent began to diversify outside the drug store industry through the acquisition of Big 5 Sporting Goods, a sporting goods chain, in 1972.^[12]

Thrifty expanded into general merchandising by the gradual acquisition of The Akron chain, 40% in 1976,^[13] increasing to 90% the following year,^[14][15] and eventually to 100%.

Thrifty's parent, Thrifty Drug Stores Co. Inc., became Thrifty Corp. in 1977 to better reflect the parent company's expansion into non-pharmacy businesses through the purchase of companies such as Big 5 Sporting Goods and The Akron.^[16]

During the 1980s, Thrifty further diversified by entering into several joint ventures with Herbert Haft and his East Coast-based Dart Drug that would introduce Crown Books and Trak Auto to the West Coast. Thrifty acquired 50% ownership of Crown and had opened several bookstores in the Los Angeles area in 1981.^[17][18] In 1983, Thrift acquired 50% ownership in Trak and also opened several of the auto parts stores in the Los Angeles area,^[19]

In Washington State, Thrifty went by the name of Giant T since the Thrifty name was in use by another chain of drug stores. The name was later changed to Thrifty in 1984.

Thrifty Corp. itself was acquired by Pacific Lighting, the parent of Southern California Gas, in 1986.^[20][21] In 1988, Thrifty acquired Pay 'n Save and Bi-Mart.^[22] Following the acquisition, all Thrifty stores in Washington state were renamed to Pay 'n Save.^[23]

Thrifty closed all their Arizona stores in 1992 and withdrew from the state.^[24]

Thrifty Ice Cream

Single scoop of Circus Animal Cookies ice cream on a cake cone

The Thrifty name and logo live on through Thrifty Ice Cream, sold in West Coast Rite Aid locations and various ice cream shops in the southwestern United States and northern Mexico.^[25] Rite Aid preserved the Thrifty Ice Cream brand because it won numerous awards in its history,^[26][27] and remained well known for its affordable prices, quirky flavors, and iconic cylinder-shaped scoops.^[25] Popular Thrifty flavors include longtime hits Chocolate Malted Krunch, Butter Pecan, Mint 'N Chip, and Rocky Road, as well as more recent introductions such as Circus Animal Cookies, made with real Mother's Cookies.^[26][28]

Thrifty Ice Cream counters located within Rite Aid stores sell hand-scooped ice cream in single-, double- or triple-scoop servings on sugar, cake, or waffle cones. The ice cream also comes pre-packaged in 1.75-quart (56 oz) "sqrounder" cartons ("kind of square, kind of round")^[28] and 1-pint cartons. Thrifty traditionally sold packaged ice cream by the half gallon in simple, waxed-paper boxes formed by folding interlocking flaps; these distinctive brick-like boxes were phased out in early 2008.^[28][29]

Like most early-twentieth-century drug stores featuring an in-store grill and soda fountain, Thrifty initially purchased ice cream from local suppliers. However, as Thrifty constantly opened new stores and expanded rapidly throughout Los Angeles, it became increasingly difficult to secure a steady supply of high-quality ice cream at a low price. To meet the demand created by their new stores, the Boruns decided in 1940 to produce their own ice cream by purchasing Borden Ice Cream Company's existing Hollywood factory for $250,000.^[30][31]

Thrifty replaced the Hollywood plant in 1976 with a larger, 20,000-square-foot facility located on 3 acres in El Monte, California. Intended to supply the then-existing 450 Thrifty stores as well as outside purveyors, the new facility was initially capable of producing 16 million gallons of ice cream annually.^[31][32][33] In 2010, the plant produced ice cream for 599 Rite Aid stores across California, as well as wholesale customers such as Farrell's Ice Cream Parlour and Costco, which accounted for 40% of sales. The reborn Farrell's franchise tested a hundred brands before reselecting Thrifty as its supplier and winning the Orange County Register's 2010 Best Ice Cream contest.^[32] Thrifty makes its ice cream using a flash-freeze technique in the manufacturing process to minimize the size of ice crystals.^[29][34] The final product is frozen at −60 degrees for at least a day before leaving the factory.^[28]

Thrifty ice cream has won numerous gold medals at the Los Angeles County Fair and California State Fair since 1948. Reporting on Thrifty's thirteenth consecutive gold at both fairs in 1961, the Torrance Herald explained that ice cream at these "two widely acclaimed competitions" is judged on flavor, body, texture, sanitation, color, and packaging.^[35] Thrifty has won gold medals at the L.A. County Fair every year since 1952.^{[31][36][37][38][39]} In 1988, Thrifty ice cream received a total of 24 gold medals at the L.A. County Fair, more than any other competitor.^[31][40]

Many recipes have remained unchanged for over 50 years, and real pieces of fruit and cookie are used along with Real California Milk.^[26][32] Thrifty ice cream contains 10.25% butterfat, compared to 12–16% butterfat in premium rivals costing twice as much.^[32] As recently as 1974,^[41] a single scoop could be purchased for just a nickel.^[42] The price increased to $0.10 by 1976,^[43] to $0.15 by 1981,^[44] to $0.35 by 1991,^[45] to $1.29 by 2010,^[32] and to $1.79 by 2013.^[46]

Thrifty achieved Kosher certification for its ice cream products in 1994.^[47]

Since 1995, Bon Suisse, a California-based company, has held an exclusive license to use the Thrifty brand name and sell Thrifty ice cream in Mexico, Latin America, and the Middle East.^[48] As of May 2014, Helados Thrifty had 184 locations^[49] in the northern and central Mexican states of Baja California, Baja California Sur, Sonora, Sinaloa, Jalisco, Colima, Nayarit, and the State of Mexico.^[50] There are plans to expand throughout Mexico via the sale of additional franchises. All Thrifty ice cream sold in Mexico is produced by the El Monte, California, plant.

In October 2015, Walgreens announced that it will acquire Rite Aid, but said that it had not yet made a decision whether it would continue to carry any product line that is sold by Rite Aid, which is not currently distributed by Walgreens. Thrifty Ice Cream customers are concerned that Walgreens is going to discontinue carrying their beloved ice cream.^[51][52]

Notes

• Pay Less to jump $1 billion sales hurdle in 1984 Discount Store News, July 23, 1984
• Pay Less changes mix, closes Wonder World units - Annual Industry Report, part 2 Discount Store News, July 18, 1988
• Thrifty PayLess. Drug Store News, April 28, 1997

References

External links

• History of Thrifty PayLess (prior to acquisition by Rite Aid)
• Thrifty Ice Cream Mexico
• A look inside the Thrifty ice cream plant (video)