John Lewis to launch strategic review amid expectations of dismal results

John Lewis to launch strategic review amidst expectations of dismal results
The John Lewis Partnership owns the freehold of around 10 per cent of its properties, while the remaining portfolio are a mix of short and long leases.
// John Lewis Partnership chair Dame Sharon White expected to unveil strategic review
// The retail giant is reportedly talking to McKinsey about their involvement in a review
// John Lewis Partnership expected to post dismal results due to massive writedown on the value of its properties

John Lewis Partnership’s new boss is reportedly going to launch a strategic review amid reports that the retail giant is expected to post dismal full year results this week.

According to The Sunday Times, Dame Sharon White – who took the helm at parent company of John Lewis and Waitrose last month – is liaising with consultancy firms including McKinsey about their involvement in a strategic review.

White is also reportedly working with newly appointed executive strategy director Nina Bhatia on the review.


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The news comes amid speculation that the partnership could post a loss in the hundreds of millions in its full year trading update, due to massive writedown on the value of its properties.

The John Lewis Partnership owns the freehold of around 10 per cent of its properties, while the remaining portfolio are a mix of short and long leases.

The company’s share of sales generated from physical stores could be brought under the spotlight amid concerns of declining footfall and online sales now taking up around 40 per cent of total sales.

White has already hinted she could make some adjustments to the partnership’s restructuring plan that was launched by her predecessor Sir Charlie Mayfield.

The restructuring plan will effectively merge John Lewis’ and Waitrose’s head office functions into one team, resulting in 75 job cuts and savings of around £100 million.

It prompted the resignation of Waitrose managing director Rob Collins and the surprise resignation of John Lewis managing director Paula Nickolds, who had been slated to become the new brand executive director, overseeing both John Lewis and Waitrose in a newly-created role.

When Mayfield’s restructure was first unveiled in October, the partnership said White had concurred with it.

White has since told the Gazette – the company’s in-house magazine – that “there will be some adjustments”, but stressed that Mayfield’s “Future Partnership” structure was the right path as the business was “stronger” when it works “collaboratively” thanks to a 40 per cent customer overlap.

White also previously warned of potential store closures and job cuts, given John Lewis Partnership is enduring its most difficult period since the 1920s.

In its half-year report published in September, underlying pre-tax loss came in at £25.9 million, compared to profits of £800,000 for the same period in 2018.

This marked the first half-year loss in the partnership’s history.

Over the crucial Christmas trading period, Waitrose like-for-like sales edged up by only 0.4 per cent while John Lewis’ sales dropped by two per cent.

This prompted then-chairman Mayfield to warn that annual staff bonuses may be scrapped for the first time in 67 years.

The John Lewis Partnership has stressed that its restructuring plan was not in response to cashflow issues that have sent a raft of fellow retailers in the path of CVAs or administrations.

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13 COMMENTS

  1. How can she have concurred with it when she wasn’t even working for them? What the heck was Mayfield doing all this time, launching a restructuring just before retiring then dumping all the asset write downs on White? She has been thrown under the bus, well and truly.

  2. Saw this coming 10 years ago. It went from a good quality family store to a overpriced good quality store .Far tò expensive for average John Lewis shoppers. Cutting staff is nòt the answer…look higher up .Also I have shopped here since 1970 but Aladdin no more.

  3. Thats the price for a one million pay ticket – plus ah hem bonus…

    Paula was set up for a fall I think…They knew the results were going to be bad and I expect Sharon asked for a scapegoat to ease her entry…The Partnership do not normally behave like that.

  4. O dear no bonus job cuts all over shop closing redundant all over struggerling john lewis not a good firm to work for any more at all

  5. Sell the long lease on Peter Jones
    Sloane Square re develope the site
    Reduce the selling space and use the extra space as luxury flats.
    Bonuses are Bonuses and not part of your wages.. Change from a partnership to a Ltd Co..

  6. Waitrose Branch Partners should consider asking why their Head Office deems it necessary to continue a massive overspend on a new IT Solution from IBM… Master Data Manager is costing tens of millions without it being fully scoped to replace existing systems which although old, they work and are very cost effective in the current economic climate. The current spend in both divisions for new IT solutions are becoming a significant burden on the businesses as a whole and in my view, are unaffordable against the current balance sheet.

  7. I look forward to the details tomorrow ( 5/3/20) The message is still not getting through. What they really need is some good retailers not more strategists. How many millions are they going to pay out to find out what any seasoned retailer could tell
    by actually walking around the stores.

  8. All partners are equal, but some are more equal than others
    My wife worked for JL for 12 years P/T and is now retired. I ran my own business for many years. As far as I can tell from my limited knowledge the company was severely top heavy. The staff selling and speaking to customers are paramount not standing around discussing the weather.
    I suggest going back to basics, it’s not rocket science and retailers are basically stall sellers keeping the tills ringing

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