GlobalData: Boots needs store revamps and health focus
GlobalData says the Weston family should reinvest in Boots' pharmacy and modernise smaller stores, applying a Shoppers Drug Mart-style health model.
The Weston family has agreed to acquire Boots from Sycamore Partners. The retailer's next owners should put health expertise and store investment at the centre of the strategy, said Charlotte Chilcott, retail analyst at GlobalData.
Chilcott said in a statement that Boots is "a strong, profitable business with genuine headroom for growth under the right stewardship." She pointed to the Weston family's operation of Shoppers Drug Mart in Canada as evidence that the owners know how to run pharmacy-led health and beauty retail.
Boots, Chilcott said in the statement, is "uniquely strong in both health and beauty," which sets it apart from Sephora and Space NK. Those rivals focus exclusively on beauty. The pharmacy side, she said, has been "deprioritised relative to beauty expansion." The Westons should apply the Shoppers Drug Mart model, investing in more trained health advisors and clinical services to support revenue growth while keeping the beauty proposition intact.
Consumer demand for self-care and wellness is rising, Chilcott said, and Boots is well placed to capture growth in both categories.
Store consistency is the second priority. Flagship locations have been revamped. Boots runs a large network of smaller stores, she said in the statement, that have not seen the same investment and "remain visually outdated." She called for a disciplined programme to align design and merchandising with flagship standards.
The programme, Chilcott said, would "lift the brand image across the entire portfolio" and drive traffic for the business in stores that currently underperform.
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