The full effects of the Covid-19 pandemic on world-renowned retailer John Lewis have been laid bare in its full year results.
The employee-owned business reported a £517m profit loss for the 12 months ended 30 January 2021, in what it described as a ‘difficult’ year for retail.
John Lewis said the figures were the result of substantial exceptional costs of £648m, mainly the write down in value of its shops, owing to consumers’ shift to online shopping during the multiple lockdowns across the UK, as well as restructuring and redundancy costs from closures.
Sharon White’s group said its bricks-and-mortar fleet is now worth half the value of before this year’s write downs.
Going forward, John Lewis said it expects 40% of its profits to come from areas outside of retail, namely financial services, housing and outdoor living.
The department store chain has already begun its search for cash investments outside of retail by applying for planning permission to rent out space from its Oxford Street store as offices, according to reports.
Stores for the future
John Lewis has also laid out its new retail plans with a focus on digital investment and updating its product offering
In the statement, White confirmed not all of John Lewis’ stores will reopen on 12 April, when non-essential retailers can welcome back customers. However, she said its stores will always be important to the business' model.
She also put rumours to rest on the introduction of smaller John Lewis stores at Waitrose stores across the UK.
If the trial is a success, she promised the group will roll out to 331 Waitrose shops.
The group is also expected to down-scale its stores for a more local feel and make way for in-store experiences and services.
“We are going through the greatest scale of change in the Partnership’s 156-year history,” said White.
“As employee-owners, we share the responsibility of securing the Partnership for future generations of customers and Partners. Difficult decisions taken now will hopefully set the course for those next generations.”