Industry

Omnichannel delivers a boost as John Lewis and Waitrose turn in full-year online sales growth of more than 40%

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John Lewis at home Swindon CGI 128hA quarter of all John Lewis sales were made over the internet in its latest financial year, one in which it and its sister company Waitrose both reported strong growth in ecommerce sales.

Reporting its full-year results, the John Lewis Partnership [IRDX RJLP] said John Lewis’ online sales rose by 40.8% in the year to January 26, compared to the previous year, while Waitrose.com’s online sales were up by 49%, ahead of market growth of 19%.

In the year to January 26 the John Lewis Partnership, which owns Waitrose and John Lewis, saw revenue rise by 9.1% to £8.47bn while profits before tax and the Partnership bonus rose by 15.8% to £409.6m. Staff, who own the company through the Partnership scheme, will receive a 17% bonus, equivalent to nearly 9 weeks pay.

At supermarket Waitrose [IRDX RWAI], revenue rose by 6.8% to £5.42bn, with a like-for-like rise in sales, excluding petrol, of 3.4%. Operating profit came in at £292.3m, 12.2% up on the same time last year.

John Lewis’ [IRDX RJLW] revenue rose by 13.5% to £3.05bn, with like-for-like sales up by 10.5%. Operating profit came in at £216.7m, up by 37.2% on last time.

“Although the market remains challenging, the partnership has adapted quickly and successfully and we saw the benefits this year,” said Charlie Mayfield, chairman of the John Lewis Partnership.

“We have stepped up innovation in new products, there’s been a continuing focus on value and sustained and rapid growth online. This resulted in over 1.5m more customers choosing to shop with Waitrose or John Lewis than last year.”

Johnlewis.com’ gross sales rose by £278m to £949m, approaching the totemic £1bn in sales, and accounting for 25% of all its retail sales. The omnichannel effect was clear with nearly two-thirds of all John Lewis sales involving customers visiting shops as well as the website.

To keep pace with growth, the site has been relaunched on a new £40m platform, and French and German language websites are set to launch later this year. Investment has also gone into new distribution centres for both John Lewis and Waitrose, while spending is also set to increase during the year ahead, with a focus on supply chain, technology and systems.

John Lewis said click & collect had been a “key part of this change in shopping behaviour” and was its fastest-growing fulfillment channel. Click & collect orders, it said, had almost doubled year-on-year, with 43% of such purchases collected from Waitrose branches.

Mayfield said: “We see this as a time of significant opportunity in a changing market. Behind the scenes, therefore, there’s a quiet revolution underway in our supply chain, IT and support functions. Our investment in these areas is up substantially and that commitment continues into 2013.

“In recent years, the Partnership has consciously invested to have the right skills, systems and organisational structures to be able to offer customers what they want in a fast-changing market.”

Mentioned in this piece…

John Lewis Partnership

John Lewis Partnership

IRDX: RJLP

The John Lewis Partnership is the parent company of the John Lewis chain of department stores and Waitrose. (more…)

Waitrose

Waitrose

IRDX: RWAI

Waitrose is a chain of British luxury supermarkets, forming the food retail division of Britain’s largest employee-owned retailer, the John Lewis Partnership. Its head office is in Bracknell, Berkshire, England.

As of February 2014 Waitrose has 5% of the market, with 317 branches across the United Kingdom, including 30 “little Waitrose” convenience stores. The company is the sixth-largest grocery retailer in the UK. Waitrose online customers can choose click-and-collect or home delivery. (more…)

John Lewis

John Lewis

IRDX: RJLW

John Lewis is a UK-based multichannel department store. As of April 2013, the John Lewis Partnership operated 43 John Lewis stores throughout Britain. The Oxford Street store, originally opened in 1864, is the largest operated by the Partnership. 29 of the stores are traditional department stores and 9 are ‘John Lewis at home’ stores.

John Lewis is a constituent of the John Lewis Partnership along with its sister company Waitrose. (more…)

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