NEWS

Boots exploring hundreds of store closures

Published on: 29th May 2019

Owner Walgreens Boots Alliance (WBA) has placed more than 200 outlets under review for possible closure during the next two years.

Sources close to the company claim that decisions had yet to be made about the stores under scrutiny, but acknowledged that a significant number were likely to be shut.

WBA said in April that it was undertaking a review of its Boots The Chemist estate “focusing on low-performing stores and opportunities for consolidation”, although it declined to specify then the number that it was considering shutting. The closure of the 200-plus shops being examined would equate to just under 10% of the chain’s standalone UK health and beauty outlets.

An insider said that some of the affected sites would close at the expiry of their leases, while others would be part of a consolidation in towns which currently have two separate Boots stores. Where possible, staff would be redeployed to an area’s existing, or new, store.

Employing roughly 56,000 people, Boots is one of the largest retailers in Britain by store numbers and also trades from about 1100 opticians and hearing-care shops which use its brand. The retailer saw profits fall by more than 18% last year, and has warned that it would be included in a broader push to cut costs by £1.2bn by the 2022 financial year.

WBA would not be eligible to use a CVA because companies need to be able to demonstrate that the alternative to their implementation is insolvency. If it opts to shut all of the stores it is reviewing, it would be among the largest closure programmes seen to date on UK high streets, a situation which retailers say has been exacerbated by government policy on business rates.

Boots has also announced plans to cut hundreds of jobs at its head office in Nottingham.

In a statement issued alongside its second-quarter results last month, a spokesperson for the retailer said: ” As is natural with a business of our size, we have stores opening, closing and relocating on a regular basis, but we have had around 2,500 stores open for several years now.”

The spokesperson highlighted the opening of a flagship store in London’s Covent Garden on the site of a former Marks & Spencer outlet.

“We are being realistic about the future and that we will need to be agile to adapt to the changing landscape,” the statement added.

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