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Last Updated: Tuesday, 14 March 2006, 10:08 GMT
Boots set to cut up to 2,250 jobs
Boots store
About 700 stores are set for a face lift
High Street retailer Boots has said it is planning to cut up to 2,250 jobs from its supply chain operations over the next three years.

Boots is building a new automated warehouse in Nottingham which will allow it to replace 17 older sites with smaller lorry-docking facilities.

Boots also announced it was investing money to revamp its smaller pharmacies.

"This is a major step forward in our plans to build a better Boots," said chief executive Richard Baker.

Boots is in the process of merging with drugs distributor and retailer Alliance UniChem, a deal which is set to be completed later this year.

Its shares rose 3% to 735 pence following the announcement.

Store revamp

The company said that the new reforms were "independent of, but complementary to, the proposed merger with Alliance UniChem".

Our small stores have been underinvested and are important to the communities they serve
Richard Baker, Boots chief executive

Boots said the three-year timescale for the changes to its supply chain meant that there was a good opportunity to minimise redundancies through natural wastage.

Where possible, the company said, it would seek to redeploy and relocate workers.

The retailer is to spend a total of 250m on its supply chain - including 70m on the new warehouse in Nottingham - and on revamping 700 of its smaller stores.

The investment is being funded by the proceeds from the sale of Boots' non-prescription drug business, Boots Healthcare International, last year.

Existing sites to be replaced
Basingstoke
Belfast
Bradford
Bristol
Cardiff
Chelmsford
Chester
Coatbridge
Dartford
Greenwich
Heywood
Nottingham
Plymouth
Rochdale
Spennymoor
Thetford
Wellingborough
Sites to close over next three years

Mr Baker said the investment in the smaller stores was long overdue.

"Our small stores have been underinvested and are important to the communities they serve.

"It is appropriate that we invest in these stores in order to provide the pharmacy-led healthcare role that both we and the government envisage."

Boots said that the changes to its supply chain, plus reforms to its IT systems, should cut its operating costs by about 60m a year by 2010/11.

Unions said they would be talking to Boots about the proposed job losses.

Usdaw national officer Joanne McGuinness said: "Usdaw will now be entering consultations with Boots management to look at the business case behind this proposal to centralise their retail supply chain which could have an impact on the long term job security of our members.

"Our message to our members is not to panic as even if the proposal to centralise the existing supply chain goes ahead there will be no job losses for at least three years."




SEE ALSO:
Boots merger deal gets go-ahead
07 Feb 06 |  Business
Boots upbeat on Christmas sales
12 Jan 06 |  Business
Boots profits hit by revamp costs
27 Oct 05 |  Business
Boots announces 7bn merger deal
03 Oct 05 |  Business


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