TIDM45GD
RNS Number : 3245C
Lewis(John) PLC
16 October 2020
John Lewis plc makes the following announcement for John Lewis
Partnership plc, the ultimate holding company of John Lewis
plc.
7:45am, Friday 16 October 2020
Waitrose and John Lewis set out bold plans to reach more
customers
-- Plan aims to see the John Lewis Partnership reach GBP400m profit by year 5
-- Expansion of digital, virtual and delivery services to get closer to customers
-- Inspirational new services and partnerships to rebalance business beyond retail
-- Pledge to recruit young people coming out of the care system
-- Major commitments on cutting waste and net zero carbon
Waitrose and John Lewis, two of the UK's best loved and trusted
retailers, today unveil plans to become the go-to brands for
customers who want quality, value and sustainability.
Owned by the John Lewis Partnership, the UK's largest
employee-owned business, Waitrose and John Lewis are founded on
being a better way of doing business. Championing equality,
wellbeing and sustainability for the good of customers, Partners,
suppliers and communities.
The nature of the Partnership model allows us to invest with a
longer term perspective than a conventional business, even in
challenging times and amidst a very uncertain economic outlook.
With this in mind, our five-year plan is self-funding and takes
into account uncertain trading.
The Partnership Plan sees our business continuing to adapt
rapidly to changing shopping habits, getting closer to customers
online and in-store. We'll also expand in new areas where we
believe our values can be a force for good.
Making value and quality more accessible
-- Affordable quality. Waitrose will continue to emphasise the
value for money we offer and ensure that customers feel recognised
and rewarded for shopping with us. Our Essentials range has seen
sales rise by nearly 10% in the past six months. John Lewis will
relaunch its Home range in the spring and introduce more affordable
price points. This will reinforce fair value to broaden our appeal
to more customers, recognising shoppers are especially cost
conscious at the moment.
-- Digital and virtual. As shopping habits evolve, we're
bringing expert Partners and products into customers' homes through
a tap on an app. This means investing in more virtual services like
personal styling , home design and the John Lewis Virtual Christmas
shop .
-- Waitrose - delivered. We'll grow delivery capacity beyond
250,000 orders per week, up from 55,000 before the pandemic, to
give customers greater convenience. And we'll save 25% of delivery
slots for the vulnerable. To attract new customers, we plan more
partnerships like the trial with Deliveroo, which delivers shopping
in 30 minutes.
-- Inspirational new services. We're a Partnership for positive
change, improving lives and building a more sustainable future.
We'll grow in areas where these are important to our customers,
like rental, recycling, savings, insurance and private rented and
social housing.
More sustainable and ethical
-- Net zero carbon. Today, we're bringing forward our ambition
to be net zero carbon by 15 years to 2035.
-- Waitrose sustainable food ambitions. We're committing to
source only from net zero carbon farms in the UK by 2035. And in
addition to our commitment to halve food waste in our own
operations by 2030, we're today extending this to our supply chain
too. We'll also aim to help halve our customers' household food
waste by 2030.
-- John Lewis leading the 'made to last' movement. We'll do more
to ensure our products can be loved for longer and today make three
bold commitments: all product categories will have a 'buy back' or
'take back' solution by 2025; all key raw materials in our
own-brand products will be from sustainable or recycled sources by
2025; and we'll develop sustainable rental and resale options for
customers.
-- Recruiting people from the care system. Today, we're pledging
to recruit people coming out of the care system to help them forge
a career in the Partnership. We know we must go further to better
reflect the whole of the UK, and we're taking steps to do so.
-- Real Living Wage. All profits we make are either invested
back in the business or shared with Partners as co-owners of the
business. Today, we are committing that when we expect to reach
over GBP200m profit, we will pay Partners the voluntary Real Living
Wage. We also aim to pay a bonus when profits exceed GBP150m and
our debt ratio falls below 4 times.
Backed by a renewed focus on service and cost savings, the
Partnership aims to see profits reach GBP200m in the next two years
and GBP400m by 2025. As we're not owned by shareholders, we can
share this success with our Partners, customers, suppliers and
communities.
The Partnership Plan builds on strong momentum in a tough year.
We've tripled delivery capacity for Waitrose online to over 190,000
weekly slots in just six months. John Lewis is now a 60% online
retailer, and has successfully adapted to offer many in-store
services online.
Investing in the customer experience
First-class customer service delivered by Partners is our unique
strength. We know it's not always been as easy as it should be to
shop with us, so we're first investing to deliver a fantastic
experience - online, on the phone and in-store.
We're committing GBP1bn over five years to accelerate our online
business and transform our shops. This will make it easier for
customers to shop with us on our websites and apps, and provide
more convenient delivery options. And we're modernising Waitrose
and John Lewis shops so we have the right space in the right
place.
We'll do this by aiming to save GBP300m per year by 2022, making
our operations and head offices simpler and more efficient. Making
these savings is crucial to free up money to invest and to deliver
our plan.
Better together
Waitrose and John Lewis will work much more closely together, in
store and online, bringing new inspiration and excitement to all of
our customers. Already this year, our popular Waitrose Christmas
hampers are available through John Lewis and our John Lewis
Christmas trees will sit at the front of 300 Waitrose stores, with
shoppable QR codes.
We'll make John Lewis more accessible locally in different
formats, building on significant expansion in Click & Collect.
We'll soon have 1,000 locations - through shops and collection
points - to buy or pick up our products to reflect changes in how
people are shopping with us.
We're investing in data analytics and loyalty plans across our
brands to reward and develop deeper relationships with our
customers. Substantial customer research is under way to inform our
new value pledge, which will be announced next year. Never
Knowingly Undersold remains in place until then.
Our ambition for Waitrose, which was recently voted Which? 2020
UK supermarket of the year, is to be customers' first choice for
food and drink when quality, ethics and service matter. More of our
business will be online, delivered and digital.
John Lewis' focus is on meeting the needs of families with a
variety of products, services and celebrations all under one roof
and online. As shopping habits continue to evolve, we'll become a
60-70% online retailer by 2025, alongside our inspiring shops.
Both brands will also add more local assortments that reflect
the diversity of our customers depending on where they live.
Partnerships for growth
We're creating partnerships to reach new customers and provide
capabilities we don't have, building on trials with Deliveroo and
online furniture rental business Fat Llama. We'll add more products
to Fat Llama after all initial products were rented out.
Today, we've announced an additional 25 Waitrose shops that will
join five other stores in the Deliveroo trial*, which is attracting
new, younger customers. We're also in discussions with Deliveroo
about joint community initiatives.
Inspirational new services
After the first phase of improving customer service in our core
retail business, we're committing a total of GBP400m to grow in new
areas where we are trusted and which fulfil customers' needs. We're
also doing so because tightening retail margins in the long term
won't allow us to pay the wages we would like, or invest in our
customers and communities. We're targeting 40% of our profits from
new areas by 2030.
Financial services . We're already successful here and the
Partnership credit card is the UK's biggest retail credit card.
We're committing GBP100m over five years to quadruple this
business, offering new products and services like savings and
insurance, where trust really matters for customers. Today, we're
announcing a new partnership with four best-in-class experts to
create a new home insurance product for our customers**. Customers
will also be able to apply for retail credit across all our
channels through a deal with BNP Paribas from early 2021.
Housing . We've identified 20 sites we own that could be used to
benefit local communities by providing quality and sustainable
housing, while providing a stable income for the Partnership. We'll
make planning applications for two of these in the new year in
greater London. Entering the 'build to rent' market also allows us
to furnish properties using John Lewis Home products and deliver
Waitrose food. We're a landlord already at three of our properties
so this is an obvious extension for us. And we're now talking to
developers and investors who can help us achieve our ambitions.
Outdoor Living. We'll start by joining up what we already do
across both brands, including horticulture in Waitrose, garden
furniture in John Lewis and our plant nursery, garden design and
landscaping services at Longstock Park on the Waitrose Farm. We're
carrying out research to understand what customers want, and
considering new partnerships and possible acquisitions.
Rental/Resale/Recycle. This is a growing priority for our
customers. We've today set targets on being more sustainable and we
have more than 20 initiatives running across our different product
ranges or being developed to test with customers.
Sharon White, Chairman of the John Lewis Partnership , said:
"We've seen five years of change in the past five months and
Waitrose and John Lewis have responded with great agility. Our plan
means the John Lewis Partnership will thrive for the next century,
as it has the last."
"We're adapting successfully to how customers want to shop
today, while showing the Partnership is improving lives and
building a more sustainable future. We'll share our success with
our customers, Partners - who own the business - and our
communities."
Nina Bhatia, Executive Director of Strategy & Commercial
Development at the John Lewis Partnership , said: "This is a bold
plan to grow our business and get us much closer to our customers.
Waitrose and John Lewis are two of the country's most trusted
brands and we'll offer the best products and customer service on
the high street and online."
"We're creating new inspirational services for customers where
strong ethical values and peace of mind matter, like reusing and
recycling products, personal savings and rented housing. Our plans
will firmly establish Waitrose and John Lewis as the go-to brands
for customers that care about quality, value, and
sustainability."
-ENDS-
Notes to editors
*Deliveroo
From today, our Deliveroo trial is expanding and will be
available in the following 30 shops: Bracknell, Clifton, Surbiton,
Fitzroy Street (Cambridge), Notting Hill, Canary Wharf, West
Hampstead, East Putney, Southampton, Clapham Common, Balham,
Parkstone, Woodley, Hereford, Cheadle Hulme, Welwyn Garden City,
Farnham, Byres Road, Clerkenwell, Southsea, Trinity Square,
Caversham, Harborne, Solihull, Wimbledon Hill, Brighton,
Bloomsbury, Winchester and Stratford City.
**Home Insurance partnership
From early 2021, we'll be working with Munich Re's Digital
Partners, ICE Insuretech, Sedgwick, and Hood Group to deliver an
innovative home insurance product.
About the John Lewis Partnership
The John Lewis Partnership owns and operates two of Britain's
best-loved retail brands - Waitrose & Partners and John Lewis
& Partners. Started as a radical idea nearly a century ago, the
Partnership is the largest employee-owned business in the UK and
among the largest in the world, with over 80,000 employees who are
all Partners in the business. For all intents and purposes, the
Partnership is a social enterprise; the profits made are reinvested
into the business - for customers and Partners. Waitrose &
Partners exports products to more than 50 countries worldwide and
has 12 shops which operate under licence in the UAE. The business
includes the online grocery service, Waitrose.com , as well as
specialist online shops including waitrosecellar.com for wine and
waitroseflorist.com for plants and flowers. John Lewis &
Partners operates 42 shops plus one outlet across the UK as well as
johnlewis.com . Waitrose & Partners has 335 shops in England,
Scotland, Wales and the Channel Islands, including 61 convenience
branches, and another 27 shops at Welcome Break locations.
Enquiries
John Lewis Partnership
Chris Wynn, Partner & Director of Corporate Communications,
07980 242019, chris.wynn@johnlewis.co.uk
Sarah Henderson, Partner & Senior External Communications
Manager, 07764 676036, sarah.henderson@johnlewis.co.uk
Debt investors
Lynn Lochhead, Partner & Head of Treasury and Corporate
Finance, investor.relations@johnlewis.co.uk
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END
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