Boots has warned of possible store closures in the UK as the company tries to cut costs. The Walgreens Boots Alliance said it would take “decisive steps” to reduce costs as part of a “significant restructuring”.
The company has 2,485 stores across the UK and employs around 56,000 staff. The firm said a store portfolio review was underway across the global business.
Boots in the UK said: “We currently do not have a major programme envisaged, but as you’d expect, we always review underperforming stores and seek out opportunities for consolidation,”.
Boots’ chief executive said the market challenges had increased in three months but had failed to respond quickly meaning a “resulting in a disappointing quarter”.
The cost cuts in February meant 350 jobs were at risk in its head office in Nottingham. The company wanted to reduce costs by 20%.
The overall earnings of Boots in their second quarter had decreased by 14.3% compared to the same time last year. Boots said they are now expecting profit to be flat for the full year.
Boots is one of the well known names who are suffering from the declining high street. Last year, many shops went bust and disappeared from the high street. Other companies such as Mothercare and New Look were forced into restructuring landlord deals and closing many stores. The world of online shopping is the reason for so many high street stores closing.
Online shopping affects the high street because the internet is where the customers first choice is. This means the high street is losing money as the market are very invested in online shopping. The rent for stores is increasing so it is becoming a struggle for retailer to meet the prices and still earn large profits to run the business. As prices of rent are rising it means stores are having to increase the prices of their products to survive. By doing this they are losing customers as with research they can find cheaper prices online.
