The decision for the cut has been made after Boots have been under increasing pressure from shareholders to improve performance and sales as it faces tough competition from supermarkets and other rivals. The move is also because the company needs to try and find £100 million of cost savings, they are also looking to strip out further costs as as a way to reach this huge target!
The company announced a 17% fall in annual pre-tax profits to $494.9 million, which has been restructuring to concentrate on the core of the business; Boots the chemists and Healthcare International and also the divisions behind the consumer brands including Nurofen, Strepsils and Clearasil.
Boot’s stores have already begun a shakeup of it’s supply chain to reduce inventory and stock holding in stores. The recent shakeup has also saw the recent departure of Chief executive Steve Russell who was with the firm for 36 years, after it was apparently said he was retiring due to stress.
The job losses follow 700 staff cuts in March when boots closed it’s well being services which came the closure of standalone stores and in February they shut a factory in Lanarkshire which cut over 1,000 jobs. The company is apparently focusing on human resources, IT functions and finance as well as some in store jobs.
Chairman John McGrath refused to rule out any further job losses and said there are more to come, the company is desperately trying to save the 100 million they need. A lot of high street stores are recently having to make cuts due to the recession and also due to the massive increase in internet sales!