Eight John Lewis stores will permanently shutter as the group presses forward with a major business strategy review.
Stores that will not reopen include the two travel hub stores in Heathrow and St Pancras, four At Home stores in Croydon, Newbury, Swindon and Tamworth, and two full-size department stores in Birmingham and Watford.
In a statement, John Lewis said the eight shops identified were “already financially challenged” prior to the pandemic, which has accelerated the switch from shopping in-store to online. Before the virus struck, 40% of John Lewis sales were online. It added this figure could now be closer to 60-70% of total sales this year and next.
Following today’s (9 July) announcement, approximately 1,300 Partners across the eight shops will now enter into consultation.
If redundancies are confirmed, John Lewis said “every effort” would be made to find new roles where possible for those who wish to remain within the Partnership. Opportunities could include transferring to local Waitrose shops or working for johnlewis.com and waitrose.com as they continue to grow.
The Partnership has also made a commitment to provide support through a unique Retraining Fund, which will contribute up to GBP3,000 (US$3,797) towards a recognised qualification or course for up to two years for any Partner with two years’ service or more. All Partners would be given access to a three-month support programme with an outplacement specialist to help with CV writing and interview skills.
“Closing a shop is always incredibly difficult and today’s announcement will come as very sad news to customers and Partners. However, we believe closures are necessary to help us secure the sustainability of the Partnership – and continue to meet the needs of our customers however, and wherever they want to shop,” Sharon White, chairman of the John Lewis Partnership, said. “Redundancies are always an absolute last resort and we will do everything we can to keep as many Partners as possible within our business.
“There are many reasons to be optimistic about the Partnership’s future. Waitrose and John Lewis are two of the UK’s most loved and trusted brands and we have adapted to the challenges of the pandemic by responding to the new needs of customers. We will soon announce the output of our strategic review which will ensure our brands stay relevant for future generations of customers.”
The news means the total store portfolio will now include 42 shops.
It comes after a letter from White to staff surfaced last week in which she is understood to have said the group has “too much store space for the way people want to shop now” and therefore it is highly unlikely all John Lewis stores will reopen following the closure of its UK-wide portfolio, part of the government’s attempt to curb the coronavirus outbreak across the country.
She is also said to have noted one of the Partnership’s London offices in Victoria will close, home to 450 staff before lockdown. The adjacent office, home to 2,400 staff, will remain open. In addition, White said the partnership’s 8,000 staff members across both John Lewis and Waitrose will likely have their annual bonus axed next year.
In April, John Lewis warned full-year sales could decline by as much as 35% and announced an acceleration of its strategic review to be completed by the summer.
For the 2019/20 period, the retailer recorded annual profits before its partner bonus programme, tax and exceptional items of GBP123m. Gross sales were 1.5% lower year-on-year at GBP11.5bn.
A month earlier, John Lewis announced plans for a strategic review of the Partnership, due to be completed by the autumn, in order to strengthen its core retail business and develop new services outside retail. The plans are to slim down head office functions and promote closer working between Waitrose and John Lewis.