Jobs cull takes shine off John Lewis revamp: Department store chain bets on £700 shoes and beauty products
The boss of John Lewis has unveiled a multi-million makeover of the department store chain – but her announcement was overshadowed by job cuts.
Managing director Paula Nickolds, 45, has opened an upmarket footwear room with shoes costing up to £695.
She is ploughing £3.5million into its beauty halls as well as setting aside £3million for staff training.
Revamp: John Lewis has opened an upmarket footwear room with shoes costing up to £695 and is ploughing £3.5m into its beauty halls as well as setting aside £3m for staff training
‘While others are investing in drones we’re investing in our partners, while others are cutting back we’re investing in the very thing that is our point of difference,’ she said.
But her comments came just 24 hours after John Lewis axed around 270 jobs in its IT, finance and security departments.
Employees have already seen bonuses slashed to the lowest level in more than 60 years, while the group made around 1,440 workers redundant last year.
M&S beefs up top team
Marks & Spencer has recruited a top director from Canada’s biggest food retailer as bosses Archie Norman and Steve Rowe beef up its management team.
Jeremy Pee, senior vice president at Loblaw, will take the new role of chief digital and data officer in December.
At Loblaw, Pee was responsible for building and growing online businesses in grocery, beauty, clothing and pharmacy. His appointment is the latest in a string of recruits which has seen M&S’s top team overhauled.
The chain hopes to make a third of its sales online.
The group has a unique partnership structure which distributes profits to all employees described as ‘partners’ through bonuses.
John Lewis is preparing to reveal a major slump in half-year profits next week which are expected to fall to zero.
Maureen Hinton, group retail research director at Globaldata, said: ‘The job cuts are obviously uncomfortable for John Lewis, it comes at a time when they’re streamlining the business.
But we are in a very tough trading environment, there’s a lot of change going on in retail.’ Analyst Nick Bubb added: ‘For all the talk about investment and increasing market share, the fact is that John Lewis profits are going backwards.
Price-matching the distressed sale promotions at House of Fraser and Debenhams has hit the bottom-line hard.
‘The best hope in the medium to long term is that House of Fraser and Debenhams largely disappear so that John Lewis can scoop up most of their business.’