MEMPHIS — Fred’s Inc. is accelerating its transition to a convenience- and pharmacy-centric retail model amid intense competition in its core general merchandise market and a surge in drug price inflation.

Fred’s Inc. is accelerating its transition to a convenience- and pharmacy-centric retail model amid intense competition in its core general merchandise market and a surge in drug price inflation.

In reporting second quarter results, Fred’s said it plans to close 60 underperforming stores without pharmacies by the end of fiscal 2014 and to step up pharmacy acquisitions to reach its goal of 65% to 70% of its stores having pharmacies. Of Fred’s 704 total stores, 357 have pharmacies.

Plans call for Fred’s to open eight to 12 stores and 38 to 46 new pharmacies in 2014, chief financial officer Jerry Shore said in a conference call with analysts. The chain also expects to shut 70 stores and 10 pharmacies, he added. Chief executive officer Bruce Efird said in the call that in the 2014 first half Fred’s made 18 acquisitions, including 10 new pharmacy locations. Another 25 to 30 acquisitions are expected to close in the second half, he said.