As the new Boots and Waitrose tie-up shows, retailers see real potential in joining forces. But how can you make sure it works?

Why collaborate?

The trial Boots and Waitrose collaboration is not the first.

The incentives are pretty clear - increased market penetration, improved brand awareness and complementary offers that enhance sales and bring an extra service to the consumer are all up for grabs.

In this case Waitrose brings huge food credibility to Boots and Boots brings its own authority to pharmacy and cosmetics at Waitrose.

What other retailers have done it?

Starbucks has a long-standing record and most recently has started to open cafes at larger Tesco stores. WHSmith has carried out several co-locations, including with the Post Office and camera specialist Jessops - the latter also collocated with Carphone Warehouse and Game in a one-off pilot store at Brent Cross retail park.

Game tested concessions inside the now defunct Borders, as did Paperchase with a complementary cards and stationery offer that it has now transferred to the new joint HMV/Waterstone’s, near Newcastle.

HMV itself has taken part in arguably the most holistic collaboration, combining an entertainment store with an all-digital Curzon cinema in a test in Wimbledon.

How successful are they?

Coffee shops have probably been the biggest and most natural tie-up, starting off in book stores and now to be found everywhere from high street banks (an ill-fated Costa/Abbey National tie-up) to supermarkets and most recently proposed cafes at some of DSGi’s new megastores.

Having a clear hook is an obvious advantage - Thorntons and Birthdays have collaborated to good effect, for example - while Early Learning Centre brought its established credibility in toys to Debenhams and latterly to parent Mothercare.

Collaborations have taken place across the sectors, for example with Laura Ashley running shop-in-shops within Homebase offering its home furnishings, wallpaper and paints, and Rough Trade’s music concession at the Topman Oxford Street flagship.

When has it not worked?

Despite its global expansionist plans toy retailer Hamleys eventually pulled out of department store chain House of Fraser, while Game has decided to close its 25 Debenhams concessions as part of a portfolio review.

Numis analyst Nick Coulter says it is not just about making adjacencies work. “Retailers also have to agree on revenue share, costs and the supply chain approach,” he says. “That is why most of the successful examples exist in department stores, which are geared up along a concession model.”