Stay informed with free updates
Simply sign up to the Retail sector myFT Digest — delivered directly to your inbox.
Just as Dame Sharon White is breaking up with the John Lewis Partnership, many of its once-loyal customers have already left the brand.
The shortest-reigning chair in the partnership’s history announced this week she would step down in early 2025 following a disastrous tenure. Both John Lewis department stores and the Waitrose supermarket chain are battling to regain profitability and the special place they once occupied in the hearts (and wallets) of Middle Englanders.
Sadly, John Lewis and Waitrose are no longer the reliable, fixed points of middle class life that they used to be — and I say this as someone who has shopped at both for decades. Pretty much everything in my kitchen was sourced in the basement of its Oxford Street flagship. The bed I sleep in was delivered and expertly assembled by two of its salaried staff. I bought my wedding dress there and got £50 off, thanks to its now abandoned “never knowingly undersold” pledge, and our fridge is full of its Waitrose Essentials range.
In short, I love both brands and want to see them thrive. But will I buy so much from them in future? It’s striking how many people I speak to think “needlessly pissing customers off” would be a more fitting corporate slogan. The customer service that was once the bedrock of both retail businesses appears to have withered as the board expands into new territory. You can already get a John Lewis Isa; next, it plans to build and rent thousands of affordable homes. But can you find a partner to help you on the shop floor?
Recently, my husband and I drove to our nearest Waitrose to do a big shop ahead of our daughter’s 30th birthday party (being middle-aged, this had all the excitement of date night). Having paid £6 to park, we lacked a £1 coin for a trolley. The partner on the customer service desk refused to unlock one, and only relented when we threatened to spend £200 on food and booze in M&S instead. That’s my petty example, but I bet you have one of your own — and these little annoyances count for a lot. Without the assurance of premium service, dissatisfied customers are left with a dizzying choice of cheaper and better alternatives.
So, as I spread Waitrose Essential English goat’s cheese on a poppy seed thin, I wonder, can the blame really be pinned on White’s lack of retail experience? Certainly, she cannot be blamed for her own appointment. The board thought the career civil servant and former head of Ofcom was the right person to lead a £12bn commercial retail business. Since this decision, there has been a brain drain of experienced retail executives. In March, the board elevated non-exec Nish Kankiwala as the inaugural CEO of John Lewis, despite his background being in consumer goods such as Hovis and Pepsi, not fashion and homewares.
Of course White cannot have foreseen Covid-19 and the cost of living crisis, but analysts question how much this can be used as an excuse for poor performance. Before the pandemic, John Lewis was blessed with a robust online business, yet it has failed to capitalise on the weakness of competitors like Debenhams, Arcadia and House of Fraser — which left hordes of middle-market spenders looking for an alternative.
Richard Hyman, partner at TPC, the retail consultancy, points out that until quite recently Marks and Spencer was considered to be weak, but that under-investment in John Lewis and Waitrose has made it easy for M&S to steal their customers. The business White inherited had a soaring cost base: years before her appointment, the partnership was pursuing massive growth in its online businesses at the same time as it opened new stores. This may have been its downfall.
“The partnership has always loved to talk about sales growth and products, but never wants to talk about profit,” is the view of veteran retail analyst Nick Bubb. He notes while M&S has aggressively closed stores, cut costs and boosted profits, John Lewis is still “massively overspaced” with legacy stores that will never generate the sales of their heyday. And while Waitrose stores have a tendency to look tired and understocked, M&S has lavishly refurbished its food halls.
White has taken bolder steps than her predecessors to address this problem (including flogging off a golf course the partnership owned) but this will not secure the scale of investment needed. She dared to think the unthinkable and consider bringing in outside investors, but the furious reaction from partners means the only option left is to trade its way out of its problems — and with the bulk of profits generated in the months before Christmas, the heat is on.
As the search for her successor begins, I wonder how much the board will acknowledge that the current strategy is not working. Unless it listens to its customers and focuses on the detail of retail, I fear more of them could be joining White in heading for the exit.
Claer Barrett is the FT’s consumer editor and the author of ‘What They Don’t Teach You About Money’. claer.barrett@ft.com Instagram @Claerb