Phar-Mor
 |
|
| Pharmacy | |
| Industry | Retail |
| Fate | Liquidation |
| Founded | 1982 |
| Defunct | 2002 |
| Headquarters | Youngstown, Ohio, United States |
|
Key people
|
Michael I. Monus, David Shapira |
| Products | Pharmacy, Liquor, Cosmetics, Health and Beauty Aids, General Merchandise, Snacks, 1 Hour Photo |
|
Number of employees
|
25,000 |
| Website | www.phar-mor.com (2001 archive) |
Phar-Mor (stylized as PHA℞-MOR) was a United States chain of discount drug stores, based in Youngstown, Ohio, and founded by Michael "Mickey" Monus and David Shapira in 1982. Some of its stores used the names Pharmhouse and Rx Place (purchased in the mid-1990s from the F.W. Woolworth Company). Low prices were advertised to bring in a large volume of sales with the slogans "Phar-Mor power buying gives you Phar-Mor buying power" and "Phar-Mor For Less." Another common slogan in their TV commercials was "Power buying saves: Save at Phar-Mor."
In 1996, the Green Bay, Wisconsin-based regional discount store chain ShopKo announced a plan to merge with Phar-Mor, but withdrew from the plan a year later, citing irreconcilable differences.
Phar-Mor's business model was based on selling a large quantity of merchandise with a very small profit margin. Many products were shipped via direct store delivery, but some were shipped through Tamco warehouses, which Phar-Mor later purchased.
Sam Walton once called Monus the only retailer that he feared, since he couldn't understand how Phar-Mor grew so rapidly in a short time.
In 1992, when the company had grown to over 300 stores and 25,000 employees, Monus and his CFO Patrick Finn were accused of embezzlement: they had allegedly hidden losses and moved about $10 million from Phar-Mor to the World Basketball League that Monus had founded. Based on deceptive data and inventory, Phar-Mor borrowed millions, ostensibly to finance its unusually rapid growth. In actuality, this infusion of cash was necessary to pay off suppliers. As a result, Phar-Mor had to file for bankruptcy protection, closed 55 stores and laid off 5,000 employees. Finn testified against Monus and received 33 months in prison. Monus' first trial ended in a hung jury in 1994; he was convicted at the second trial on 107 federal counts, mostly related to fraud, and sentenced to 17 years and 7 months in federal prison. Prosecutors estimated that the total loss to all investors exceeded $1 billion. The sentence was appealed and later reduced to nine years.
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Wikipedia