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Boots ‘on track’ to close more than 180 pharmacies in next 10 months

Boots has already closed 18 of the planned 200 stores
Boots has already closed 18 of the planned 200 stores

Boots is “on track” to close the remaining 182 of a planned 200 branches before September 2020, its parent company has said.

Walgreens Boots Alliance announced in June that it would “reduce [its] store count by 8%” in the UK within the next 18 months through a “store optimisation programme” targeting around 200 loss-making Boots pharmacies, in response to “difficult market conditions”.

Announcing its latest financial results yesterday (October 28), the company said it had already closed 18 of the planned 200 branches in June-August and is “on track to consolidate the remainder” by the end of its fiscal year, August 2020.

In a conference call, Walgreens Boots Alliance global chief financial officer James Kehoe said the company has “completed the review of our real estate footprint and the actions are well underway in both the US and the UK”.

“Dedicated teams are working hard against our biggest programs, particularly pharmacy costs to fill and shrink,” he added.

Measures to reduce cost base

On the same call, co-chief operating officer and president Alex Gourlay told analysts that Walgreens Boots Alliance “continues to take actions to address our UK cost base”, including having already cut up to 350 jobs at Boots’ Nottingham headquarters to reduce head office costs by around 20%.

“We have also generated cost reductions through simplification of our care home operations and the supply chain,” Mr Gourlay said.

He pointed to the “number of initiatives to transform our retail offering, develop healthier services and accelerate digitalisation in the UK”, including a free online prescription service via the Boots app and website and the opening of two flagship branches – in Covent Garden, London and most recently Meadowhall in Sheffield.

“We’re developing new initiatives in digital healthcare, with plans for expanding pharmacy services to improve the customer journey and broaden access to healthcare,” he added on the call.

Boots UK sales drop

According to its latest financial results, Walgreens Boots Alliance saw a 20.7% drop in profits for its retail pharmacy international division – which includes Boots UK – in the three months to August, which followed a 10.5% year-on-year drop recorded in the three months to May.

Boots UK specifically saw a 2% drop in comparable pharmacy sales, “reflecting lower script volume and a lower NHS funding level”, Walgreens Boots Alliance revealed in a presentation published alongside the financial results.

Comparable retail sales for Boots UK decreased 3.1%, “as the UK market continued to be very challenging”, it added.

9 Comments
Question: 
What do you make of the decision to close 200 Boots pharmacies?

Lucky Ex-Locum, Superintendent Pharmacist

Isn't it amazing how they make it sound so positive, like they are 'on track' to achieve something wonderful. These are real peoples lives they are playing god with. They don't give a flying f that because of their actions there will be hundreds of families whose lives will be turned upside down, but in the World According To Boots thats OK because their shareholders will be happy.

Dario Canada, Community pharmacist

“We have also generated cost reductions through simplification of our care home operations and the supply chain,” Mr Gourlay said.

Well, It's hard to have costs when the care homes leave the company... Well done Mr Gourlay

Leon The Apothecary, Student

Am I right in thinking all the homes they service were given ipads?

Julie Friday, Accuracy checking technician

Which 18 stores have closed already

Leon The Apothecary, Student

Speaking pragmatically, there are a few locations I've been where there are multiple stores within a very short distance from one another, not just Boots, but other chains as well. For those, it makes perfect sense to consolidate.

P M, Community pharmacist

switch all customers to online boots and close store .. simples

N O, Pharmaceutical Adviser

Who Cares???

Leon The Apothecary, Student

The poor staff who will be given a choice of going to another store or being made redundant.

David Moore, Locum pharmacist

@N O. Probably most of the staff in those branches

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