Dame Sharon White: It is too early to predict the end of the high street
Dame Sharon White has said it is too early to sound the death knell of the British high street even as she outlined further plans for the John Lewis partnership to move online.
Speaking to the Times CEO summit, White said the “death knell for the High Street is rather premature”, just months after cutting eight stores.
But White, who is due to unveil her new strategy on Friday, signalled a further pivot to online sales as the pandemic dramatically cuts footfall.
She conceded the move to online would be permanent and predicted online sales will be worth between 60 per cent and 70 per cent of John Lewis’ revenues and 20 percent of Waitrose sales, up 15 per cent on the grocer’s revenues last year.
“The shift to online doesn’t look like a 12-month / 18-month phenomenon: this is something that will permanently change peoples’ shopping habits. This is something which is going to permanently, I think, change people’s shopping habits,” White said.
However she noted the importance of physical stores: “Ultimately you’re still going to want to go into a store… given that we’ve all got used to shopping a bit more locally and probably more”, and the retailer will expand its click and collect service.
The difficult trading conditions have not stopped White setting ambitious targets, telling the Times the partnership was hoping for profits of £400m within five years, while recognising the need to diversify the partnership’s revenue streams.
She made it clear that John Lewis would not focus exclusively on retail and could look to move into financial services, housing and outdoor living.
“Because retail margins are falling, they’re compressing and we’ve got to find some new streams of profit that our customers want us to be in”.
And John Lewis employees will need her strategy to work as White reiterated her plans to only reinstate the staff bonus once the partnership had reached £150m in profits.
The partnership scrapped the bonus paid to employees for the first time since 1948 last month after it crashed to a pre-tax loss of £635m in the first half.
Even as John Lewis adapts to the post-Covid world of online shopping White seems hopeful of the next few months. “There’s been really good momentum in the second half. There’s loads of uncertainty… But the past few weeks have been, I think pretty positive.”