John Lewis Partnership gives covid-19 trading update
The John Lewis Partnership has said that the coronavirus crisis has had a significant impact on the trading patterns of both its Waitrose and John Lewis brands.
It said sales at the Waitrose supermarket chain have surged by 8% year-on-year since 26 January as customers stock up on store cupboard essentials like rice, pasta, long life milk, home baking items, frozen foods and cleaning products.
Demand for home delivery from the supermarket has been very strong which means it has had to increase its capacity by 50%. Waitrose said this has put it in a good position ahead of the ending of its contract with online grocer Ocado in September.
In contrast, the John Lewis department store chain has experienced mixed trading. After its shops closed due to the covid-19 lockdown, online sales have climbed by 84% year-on-year since the middle of March. The most in demand items have included products for home working and food preparation as well as keep fit products and those aimed at keeping children entertained,
However, there have been fewer sales of more profitable lines such as sofas. Overall, John Lewis sales have declined by 17% year-on-year since the middle of March due to online sales not being enough to offset the loss of shop trade.
Looking at a worst case scenario, which would assume a significant sales decline between April and June and weak sales thereafter, the John Lewis Partnership said this would result in a full year sales drop of 35% at John Lewis. Meanwhile, the worst case scenario would lead sales at Waitrose to decline by less than 5% across the year.
Last month, the John Lewis Partnership announced that it would be undertaking a strategic review of the partnership as it looks to strengthen its core retail business and develop new services outside retail.
John Lewis Partnership chairman Sharon White has now said this will be accelerated with a view to completing it in the summer.
She added: “It will seek to take account of changes in consumer behaviour to come out of the pandemic, such as a more pronounced shift to online and a desire to shop in more sustainable ways.
“The partnership has been trading for nearly a century. It has survived a world war and bombings, economic crashes and crises. Thanks to you, we shall also come through covid-19 too and emerge stronger. “
