John Lewis scraps staff bonus due to group losses and ‘soaring’ costs

There could be job losses on the cards at John Lewis as the company posted an annual loss of £234 million for its last financial year.

The Partnership announced that sales at John Lewis (excluding its sister company Waitrose) were strong at £4.94 billion, up 0.2 per cent on the previous year. And across both retailers there were more customers – 20 million of them in total – but they bought less.

Add to this a loss of £78 million for the whole year, which ended in January, and then exceptional costs were on top of that. Costs were sent “soaring” throughout the year, said Chairman, Sharon White, an increase of nearly £180 million on the previous year.

As a result, the John Lewis Partnership will not hand out a bonus to its staff, and in fact it even warned that some jobs could be at risk.

“I am sorry that the loss means we won’t be able to share a bonus this year or do as much as we would like on pay,” Ms White said. “As we need to become more efficient and productive, that will have an impact on our number of partners. That’s a massive regret to me personally,” she added.

The Partnership is employee-owned by permanent staff who are known as Partners. Those partners typically get an annual bonus payment – last year worth around £46 million. Ms White did not provide any detail on the amount of job cuts or the division/s in which they will be made.

However, the company did spend £32 million supporting its employees with a cost-of-living payment and free food over winter.

Elsewhere, Ms White reported that John Lewis was voted top UK retailer for customer service last year; “great customer service is at the core of who we are, and always will be,” she said.

And looking ahead, she said she expects market and consumer conditions to remain uncertain.

In other news, the Partnership has announced the appointment of its first group Chief Executive. Nish Kankiwala (pictured left) has been a Non-Executive Director since April 2021; he is a former Chief Exec of Hovis.

Ms White said: “Nish and I will work closely to ensure the Partnership thrives for another century. The new structure allows me to focus on the preservation of the model and our distinctive character, on the strategy for the Partnership and our big commercial choices. Nish will draw on his significant transformation experience to drive performance and profitability day to day.”