Retailer Focus: John Lewis Partnership

A YEAR OF CHANGE

It’s fair to say that there’s been a lot going on within the John Lewis Partnership over the last year: almost a total overhaul of the top management team; strong trade for Waitrose contrasting with prolonged closures for department stores; a raft of permanent department store closures; the planned opening of smaller John Lewis stores; Waitrose parting company with e-commerce partner Ocado; and the supermarket opening new store concepts while pursuing a variety of corporate and social responsibility objectives.

The relative turmoil afflicting the business is in stark contrast to the Partnership’s rather more placid history of strong trading and expansion across both divisions, a stable boardroom and a loyal workforce incentivised by generous annual bonuses – bonuses that are likely to be zero for the foreseeable future.

The management of the business has attracted a few raised eyebrows since several senior hires lack direct retail or consumer goods experience, but it seems to be the case that the new team is not afraid of making some tough choices and undertaking some tremendously overdue changes.

THE LONG-AWAITED COLLABORATION

It’s long been a mystery why John Lewis and Waitrose have managed to avoid collaborating for so long. This might have been due to siloed management and distinct P&L structures, but the levels of costly duplication and missed opportunities over the years is genuinely staggering.

Finally, though, collaboration is thoroughly underway, and we’ve already been seeing over the last few years an enhanced presence for Waitrose within John Lewis, such as food halls and cookery schools. This partnership is becoming more of a two-way street and the John Lewis presence within Waitrose is also becoming more significant via the general merchandise assortment, branded gondola ends and the opening of dedicated store-within-a-store concepts.

ANYDAY LAUNCH

As well as the regrettable store closures, John Lewis is contemplating the launch of smaller high street stores that might act as smaller brand showrooms as well as enabling online ordering, collection and returns. Another interesting move over the last few weeks has been the launch of the ANYDAY range of household goods, a lower price 2,400+ item assortment that is intended to help it better compete with the likes of more price-driven competitors like Dunelm and IKEA. The range looks decent and the instore execution was well done, so plaudits appear to be due here.

PROGRESS FOR ‘UNPACKED’

Waitrose continues to lead the way in key environmental initiatives like packaging reduction and has also been busy in other areas such as e-commerce, where it is opening new fulfilment centres and expanding its partnership with Deliveroo.

A number of Waitrose strategies are embodied by its refurbished store in the Oxfordshire town of Wallingford: it is home to the nuanced expansion of the retailer’s rapidly growing Unpacked packaging reduction programme; and it is one of a trio of stores (the others being Horley and Godalming) that have recently seen the ‘better late than never’ integration of the John Lewis proposition into its offer – an initiative dubbed ‘Better Together’.

The Unpacked initiative is rather impressive and the retailer announced an acceleration of it this month. The trial was first introduced in the Botley Road store in Oxford in 2019 and the concept has since been expanded into Wallingford, Abingdon and Cheltenham.

The Wallingford iteration is noteworthy as it is the first Waitrose to have had its Unpacked features integrated into its regular aisles rather than concentrated into discrete instore zones. The move has seen the introduction of 13 different Unpacked options encompassing over 50 SKUs including frozen fruit, rice, pasta and grains, cereals, dried fruit, snacking, coffee and washing detergent.

There is a lot to like about the Unpacked concept and, fingers crossed, this will hopefully be a successful innovation that gets rolled out across further suitable locations.

MORE INTEGRATION

Just as significant is the introduction of a fully branded John Lewis department. The John Lewis area (which has been executed incredibly well) offers shoppers the chance to pick up GM purchases in categories such as cookware, dining, toys, gifts, stationery, greetings cards and gifting. The branding and merchandising are both top-notch and the range has been well selected.

The big question over the John Lewis integration is why on earth it took so long for the Partnership to identify this move as a good idea. There are a couple of examples of bigger stores (Canary Wharf and Salisbury) that have brought both Waitrose and John Lewis under one roof, so it is a very belated welcome sight to finally see the concept regaining some traction in the mainstream Waitrose estate.

One of the highlights for us at tcc in terms of Waitrose’s recent initiatives would be the success of Unpacked. There can be no doubt that sustainability remains at the top of the agenda for retailers and consumers alike, so it is most heartening to see Waitrose really making headway on the topic of minimising packaging, with single-use plastic very much in the firing line.

We are committed to helping retailers (and their customers) improve the world around us, be that through rewarding shoppers at Coop Italia with luggage made from recycled bottles as part of a broader sustainability campaign, or engaging younger consumers in the Channel Islands on the topic of biodiversity through the ongoing Unbeelievables campaign at the Channel Islands Co-operative.