CVS to close Beauty 360 stores in cost reduction move

Drugstore giant CVS Caremark Corp. said this week it would shutter some of its upscale stores in a cost reduction campaign.

CVS said that it would close all 25 of its upscale Beauty 360 stores over the course of the year. The company is eyeing growth in other beauty segments, and analysts said the stores had underperformed over the past few years. CVS has faced mounting competition from Walgreens and local chains, as a retrenchment in consumer spending has impacted businesses across the U.S. in the wake of the recession.

"We have learned a great deal about our beauty customer through our experience with Beauty 360 and plan to apply many of these learnings to future enhancements within our beauty department," CBS public relations director Erin Pensa said.

The Los Angeles Times reports 23 of the Beauty 360 stores are located in California. The pharmacy giant said it plans to completely close the stores by mid-May. CVS founded its Beauty 360 offshoot in 2008 as a means of attracting a more upscale clientele. The stores featured high-end products not available at most CVS locations, and offered spa services aimed at driving revenue.

However, the stores struggled following the financial and housing crises, as shoppers opted to frequent established firms such as Sephora.