Sunday, 17 April 2016

One Household Name to Erase

Not long ago, on Countryfile - a favourite Sunday evening programme about life and work in the British countryside - a small article in the programme showed the 'new' Boots the Chemist factory. Bizarrely, I felt a small inner glow - that warm kind of feeling generated by safe, familiar, homely things. Not about the ultra-modern state-of-the-art factory, but about Boots itself.


Who doesn't know Boots the Chemist? They are an institution of British Life. Also now of Irish Life. The programme even went on to elucidate on Mr John Boot himself, who started the business in 1849, and his son Jesse Boot who carried it on to fame and fortune. John was a farm worker, but when he became ill, he changed his career, and - following in the footsteps of his herbalist mother - started making and selling remedies. He opened a shop in Goose Gate, in Nottingham, which after his death his wife continued to run. It was called M & J Boot, Herbalists.

It was Jesse, later 1st Baron Trent, who created the Boots that every Briton knows and - perhaps until now - has loved. Between 1883 and 1920, Jesse opened 660 shops, employing more than 14,000 people.'Chemists to the Nation', he called his company, and he set a high benchmark by looking after his own employees almost as if they were family. According to his biographer, Stanley Chapman, Boot employed welfare workers to look after the health of those who worked for him, he took staff on day trips and even set up sports clubs for them. He also became something of a benefactor, giving land to build Nottingham University and later building women's halls of residence. He was also generous to various causes in Jersey where his wife came from.

And so Boots the Chemist, the High Street name we all know and trust, was born.
It has even, over the years, become almost an extension of the NHS. I have certainly gone into Boots and asked for advice on what I should take for this, that or the other, in an attempt to stall in-coming bugs, or to avoid having to go to my Doctor. According to investigative journalist Aditya Chakrabortty, 'Healthcare professionals refer to the firm as an “essential component” of the NHS. It is to outpatient care what the high-street banks are to the UK’s money system: a massive private-sector firm delivering a vital public service. And it takes a lot of public money to do so: around £2bn a year for prescriptions alone, according to independent financial analysis, or a third of Boots’s annual income in the UK. Then come the patient-care services paid for by the taxpayer, and the contracts Boots is now taking over from the NHS – to host GP surgeries in its stores, to run pharmacies in hospitals, to manage hearing test centres and specialist clinics monitoring drugs that prevent blood clots.'

So, more than just a household name, then.

But alas, although in-store everything still seems, superficially, the same, it isn't.

I have been reading Chakrabortty's excellent article this weekend in The Guardian, and I think it's pretty safe to say that John Boot, and even his entreprenurial son Jessie, would be shocked to know that since the takeover of Boots back in 2007 by Pessina and KKR, everything has changed and continues to change. For one thing, Boots has now been passed on again - to the American company Walgreens. It's now the Walgreens Boots Alliance and looks set to become part of the US chain Rite Aid, 'a deal that will make it the largest pharmacist either side of the Atlantic – with 73-year-old Pessina at its head'.

Perssina himself - a Monaco-resident, who collects yachts, appears to have made somewhere in the region of £10bn since 2007 from the acquisition. Not a bad little earner, you might say. 
According to Chakrabortty, 'In 2006, the year he merged his wholesale business with Boots, Forbes magazine ranked Pessina as the 428th richest man in the world. By 2015, he had shot up to 99th place.'  And it has been claimed that 'Alliance Boots had legally avoided paying over £1bn in taxes to the UK since going private. Yet around 40% of the revenues for its British business come straight from the NHS'

Inevitably, the gain of some comes at a loss to others. Boots the Chemist, in this case.  According to Colin Haslam (professor in accounting and finance at Queen Mary University of London), the new board employed a financial policy of 'stretch and extract - loading Boots with debt, then pulling out as much as possible for investors without reinvesting in the business' 
Quoting from Chakrabortty's article again: 'Before the takeover, Boots UK bore a modest 50p-worth of loans for every £1 of equity, or net assets. Immediately after the takeover, that ratio shot up five-fold. It was as if a house worth only £100,000 suddenly had a giant mortgage of £250,000. Haslam, who is a former corporate financier, believes that balancing such huge debt on comparatively little equity would be judged by an auditor as “high risk”.

But even more worrying for the average Briton using Boots as a surgery-add on, are the results of a poll carried out by the Pharmacists' Defence Association trade union of its members. Chakrabortty says: 'The survey of working conditions, shared exclusively with the Guardian, is the first of its scale and kind the PDA has commissioned – and it says something deeply worrying about the profession Britons rely upon for their medicines. Open to all chemists in the PDA, whatever chain they worked for, the survey attracted 1,988 responses, of which 624 were from Boots employees – more than one in 10 of all its chemists. The survey suggests that morale across the profession is low, but that Boots pharmacists feel more pressured than those employed by Lloyds, Asda and the rest.'

To summarise just some of the subjects covered in this poll:
'Asked how often “commercial incentives or targets have compromised the health, safety or wellbeing of patients and the public, or the professional judgment of staff”, more than 60% of Boots pharmacists said that was the case half the time or more. That compares to 52% of chemists at other chains.

Asked “how often do you believe financial cutbacks imposed by your main employer have directly impacted upon patient safety”, 56% of Boots chemists said that was true “around half” or “most” of the time. A further 20% said it was the case “all the time”.

“All the company cares about is profit, figures, services. They are not interested in patient safety, appropriate staffing levels, training time for staff, appropriate breaks etc. Each day I am worried about making a mistake due to the enormous amount of pressure I am constantly under.”

'Three in every four of responding Boots pharmacists believe that the cuts imposed by their employer, whether the drop in staff numbers or increased workloads, threaten patient safety at least half the time or more. In response, Boots points out that it now employs more than 6,000 pharmacists in the UK, up from about 4,500 before the buyout. However, that rise tracks the increase in its number of stores, up from 1,400 in 2005 to around 2,400 today. I asked Boots what had happened to the number of dedicated pharmacy support staff, the dispensers and assistants that Boots chemists reported they were having to do without. The company did not respond.'

So just one more story of personal and corporate greed. It's everywhere you turn.
In 1919, in the first issue of the company newsletter, the Beacon, Boot wrote to his staff: “Fellowship in recreation, fellowship in ideals, common hope, common sympathies, and common humanity bind us together; and whatever fosters this happy union is valuable.”
Yeah, well - not any more.
I feel gutted. And I think John and Jesse Boot would feel gutted too.
I know it won't make any difference to Perssina, but I'll never shop there again.

You can read the whole of Aditya Chakrabortty's article here: How Boots Went Rogue
It's well worth reading.
You might end up shopping elsewhere too.

1 comment:

  1. The stores are not the places they used to be. I never go into Boots now. They have nothing on offer I want. It's a shame the paternalistic ideals of its founders have given way to greed and profit for its shareholders. Alas the way of so many now.


Ah, go on! Make my day - leave a comment!