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IRUK Top500 The Customer Report: 2018

IRUK Top500 The Customer Report: 2018

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Click and collect overtakes home delivery at John Lewis

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Click and collect overtakes home delivery at John Lewis
Click and collect overtakes home delivery at John Lewis
John Lewis delivered more online orders by click and collect than by home delivery for the first time in its latest financial year.

Some 54% of online orders were delivered to the store for pick up in a year in which click and collect orders grew by 47% compared to the same time last year. John Lewis online orders rose by 21.6% to £1.4bn, with Black Friday the single busiest day of the year.

Sir Charlie Mayfield, chairman of John Lewis Partnership, said: “The investments made over many years in systems, logistics and IT infrastructure combined to enable John Lewis to make more deliveries via Click and Collect than to customers’ homes for the first time. John Lewis was able to fulfil over 6.4m orders over the year with 98.7% of parcels in store the following day.”

The news emerged as John Lewis and Waitrose both enjoyed fast multichannel growth in full-year results published by parent company the John Lewis Partnership. But while sales and customer numbers lifted across both brands, pre-tax profits before exceptional items fell compared to the previous year.

The partnership today posted gross sales of £10.9bn in the 53 weeks to January 31. That’s 7.6% up compared to the same period last year, or 5.7% over the comparable 52-week period. Pre-tax profits before exceptional items came in at £342.7m, 9% down on the same time last year, or 10.5% over the 52 weeks. Bottom-line pre-tax profits came in at £350.6m, up by 6.5%, or 4.7% over 52 weeks.

John Lewis sales of £4.4bn were 9.2% ahead of last year (7.5%, 52 weeks), and operating profit of £250.5m was 10.8% up on last year (10.4%, 52 weeks). Customer numbers were 4% up.

John Lewis’ opened a new Click and Collect store at St Pancras as well as an airport shop at Heathrow store during the year. Together with a flexible format store in York, trade at these stores “exceeded expectations.”

Waitrose gross sales of £6.5bn were 6.5% ahead of last year (4.6%, 52 weeks) but operating profits of £237.4m were 23.4% (24.4%, 52 weeks) down on last year. Customer numbers rose by 6%.

Across multichannel measures, Waitrose saw online grocery sales rise by 31.2%, with average order values up by 5%.

Operating profit at Waitrose, said Mayfield, had been “held back by three factors: the impact of trading in a highly competitive and deflationary market; a significantly higher level of investment in the year; and the impact of one-off items, including property impairments and onerous leases.”

The most visible effect of the investment, said the partnership report, comes in the form of more than 4,000 iPads that it says work both to improve customer service and gives branches easier access to information. Elsewhere, some 5.4m customers now have a Waitrose card, and 68% of sales are made to cardholders. Investment has also started on Waitrose's first national distribution centre.

The fabled John Lewis partner bonus came in at 11%, the lowest level in more than a decade but, for the first time, free of tax up to the value of £3,600 thanks to changes in legislation.

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