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Boots Pharmacy London

LONDON - Nottingham-based Boots Group PLC said last month it will cut 900 jobs as part of its ongoing effort to rejuvenate its core businesses. The changes affect all support and central functions, as well as regional store support roles. Conversely, the chain plans to bolster personnel in its pharmacy department, in part to expand pharmacy hours.

"We announced the 'Getting in Shape' cost program in 2002 with the intention of achieving 100 million [pounds sterling] [U.S. $183.7 million] cost savings from back office and supply chain activities," said Boots chief executive officer Richard Baker.

Job cuts, said Baker, are the next step in that program. The reduction is estimated to save $71.6 million, of which $9 million will be reinvested in new store roles.

The retailer admitted that while it has performed steadily in the past, it failed to punch its brand and franchise weight." Subsequently, its new executive team was given a clear agenda: Modernize the business, make it more efficient and focus more effectively on the customer.

"Boots operates in an extremely competitive environment where pace of decision making and speed of implementation is integral to success," said Baker. "The proposed changes would reduce complexity and costs of head office functions, which improves our ability to compete."

Part of the retailer's strategic changes include a series of initiatives to strengthen its pharmacy business.

Our focus on competing is to have the best pharmacy services available in terms of dispensing--administered by pharmacy stores that are open at our customers' convenience, not ours," Boots' spokesperson Donal McCabe told Drug Store News. "We are also extending opening hours of many of our shops to better reflect modern doctor surgery times."

Beginning in April, a new organizational structure will create more than 300 new pharmacist roles, including 250 group pharmacy managers, 30 area pharmacy managers and four regional pharmacy managers. The retailer also will increase support staff to reflect the growing role of pharmacy technicians.

The retailer also will move some of its stores to 24-hour operations, with 80 pharmacies being open on Sundays. Additional funds will go toward upgrading pharmacies with new dispensaries and rolling out new pharmacy systems with SmartScript functionality to improve professional services and stock management.

New roles created to facilitate the changes include the appointment of Digby Emson to director of professional services and Pradip Patel to pharmacy superintendent of Boots The Chemist.

In related news, Boots made a separate announcement last month that it will create 300 part-time and fulltime jobs across its logistics operations to help transfer operations to specialist logistics company Unipart from its D82 warehouse. The move will reduce the need for large stores of spare stock currently held in retail shops.

The retailer reported that group sales for the third quarter ended Dec. 31 were up 5.2 percent as a result of growth in Boots The Chemist and Boots Healthcare International. Strong holiday sales also contributed to sales growth.

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