Boots to opt for safer 'implant' model in Asia

Boots is to pursue its Asian implant business hand-in-hand with AS Watson, which owns its UK rival Superdrug.

A Boots spokesman said the retailer 'had no plans to open any more standalone overseas stores, and would use the implant model to explore overseas markets'.

Boots has successfully opened 54 concessions selling its own-brand cosmetics and toiletries in the Hutchison Whampoa-owned Watsons drugstores in Taiwan and Hong Kong. The implant model has fared better than Boots' standalone foreign ventures in Japan, Italy and Holland.

Boots claimed there was no conflict of interest and that an 'excellent relationship' existed with Watsons in Asia, despite the fact it is a competitor.

'We are confident this strategy will deliver a return to shareholders without requiring significant capital investment,' said a spokesman for Boots.

Hutchison Whampoa-owned Chinese healthcare retailer Sen recently opened a concession in a UK Boots store.

At last week's pre-close statement, Boots announced that it had reverted its focus to core health and beauty business Boots The Chemists and drugs division Boots Healthcare International.

Chairman John McGrath said the life support machine keeping Wellbeing services and cosmetics fascia Pure Beauty alive had finally been switched off. The 290 Ahold-owned stores it operates in Holland and its outlets in Italy will also close.

The restructuring project will cost£55 million and 700 jobs, mostly in the UK.

The search for a new chief executive continues and analysts at Credit Suisse First Boston warned that the retailer 'has yet to prove it has a viable business model at Boots The Chemists to deflect competitor activity.'