Expert comment: First ever loss at John Lewis
In yet another blow to the high street John Lewis has reported its first ever annual loss. Retail expert, Dr Gordon Fletcher, of the university of Salford Business School, looks at what the future holds for this staple of the high street.
Dr Fletcher said: "The announcement of the first full-year loss for the John Lewis Partnership is a blow that comes from multiple punches. The impact of the pandemic has been to rapidly accelerate change in the retail sector at a pace that no large business can counter.
“The impact of this changing pattern of purchasing has forced the partnership to write down the value of its physical stores. Their footprint is no longer as valuable as they once were as a result of the move to online. The financial result has prompted a management decision to not reopen some John Lewis stores after lockdown.
“The big headline of the story hides the deeper reality that the food retailing sector has continued to grow during lockdown and Waitrose turned a profit over 2020. This could partially be put down to Waitrose and other food outlets being one of the few places we can still visit other than home and work. The end result is that we will see less John Lewis stores on the high street and more John Lewis products in Waitrose stores.
“For those not at direct risk of redundancy from these proposed closures the biggest blow as the UK's largest employee-owned business is that a loss means no bonuses for the John Lewis staff. And with at least some of that bonus reasonably expected to have been spent in-store the impact of the loss coupled with fewer John Lewis stores will continue to be felt in the partnership's trading figures into next year too."
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