BOOTS ANNOUNCES SHARED VENTURE WITH SAINSBURY’S

THE Boots Company and J Sainsbury are to join together in a new venture that could see the high street chemist open outlets within the supermarket chain’s stores.

Although both companies were keen to stress that a merger did not form part of the discussions, an official statement by Boots revealed that “a limited number of store based trials” were currently under consideration, and that further details were to be announced shortly.

The move could be seen as a consolidation of interests as both businesses face increasing competition in their own respective sectors. Tesco ousted Sainsbury from their market leading position over five years ago and the company has failed to recapture its previous form, having this year announced strong sales, but a dip in profits for the second year running.

Boots will also be facing a similar battle over the maintenance of its profit margins with the abolition of Resale Price Maintenance (RPM) on over-the-counter medicines, which will allow a variety of high-street competitors to sell drugs at cheaper prices.

However, both companies have been investing heavily in the promotion of the idea of the “one stop shop” model which aims to combine ‘convenience shopping’ with the availability of extra services which extend the perceived remit of the facilities already offered.

Boots’s recent diversification into specialist medical services such as LASIK clinics means it is the first major retail optician in the UK to offer laser eye surgery, and demand has led to the announcement of plans to open five more clinics in England and Scotland by August of this year. (CL)