LONDON — Over the next year, Boots plc plans to invest $702 million in sprucing up its existing stores, opening 60 new ones and creating 3,000 jobs. The company’s new chief executive officer, Richard Baker, said in a fourth-quarter trading update last week that the move would dent short-term profitability, but would pay off in the long term.
“Trading in quarter four was encouraging and demonstrates the underlying strength of Boots The Chemist,” said Baker, of the drugstore chain, which is the U.K.’s largest beauty retailer. “However, the business requires a period of significant investment in the short term to improve its competitiveness [and] efficiency, and [to] bring it up to date with modern retail practice. I am confident that as a result of these actions to accelerate investment in the business, we will be in a much stronger position to deliver sustained growth in the future.”
The news overshadowed strong fourth-quarter trading figures. Total sales are estimated to rise by 4 percent, compared with the same period last year. Sales in cosmetics and fragrances are reported to have surged, especially around Valentine’s Day.
Baker has slashed the number of store formats it has from 11 to three. Each of its 1,400 sites is now classed as a convenience store, community chemist or destination store. Baker plans to increase Sunday trading and later hours. He added that customers would benefit from improved signage, computers and tills, as well as the further lowering of prices.
— Ellen Burney