Apple Pay for online payments
US-based (SPY) drugstore chain Rite Aid (RAD) announced that it was adding Apple’s (AAPL) Apple Pay as a payment option for online purchases. Accepting Apple Pay for online sales appears to have been a natural move for Rite Aid. The iPhone is the device that most customers use to access the company’s online store.
“By accepting Apple Pay as a form of payment online, we’re staying true to our promise of making it easy and convenient for our customers to shop at Rite Aid,” stated David Abelman, Rite Aid’s chief of marketing.
Rite Aid is eliminating a large portfolio of its physical stores in a transaction with rival Walgreens Boots Alliance (WBA). The company is selling 1,932 stores to Walgreens for a cash consideration of $4.4 billion. Rite Aid expects to use a large portion of the net proceeds from selling the stores to repay part of its outstanding debt. The company was carrying long-term debt of $7.1 billion on its balance sheet at the end of fiscal 2Q18 (September quarter).
Boosting online business
Since Rite Aid is divesting itself of a large network of physical stores, the addition of Apple Pay as an online payment option could be part of the company’s efforts to boost its online business.
For Apple, Rite Aid’s move to add Apple Pay for online payments is expected to be a boost its top line. Apple’s top line grew 12% year-over-year in fiscal 4Q17 (September quarter).