John Lewis Partnership
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| John Lewis Partnership | |
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| Type | Public[1] (All shares held in trust) |
|---|---|
| Founded | Oxford Street, London (1864) |
| Headquarters | London |
| Industry | Retail |
| Products | Clothing, cosmetics, housewares, food, direct services |
| Revenue | £5.8 billion (2005-2006) |
| Employees | 64,000 (2006) |
| Slogan | Never Knowingly Undersold (John Lewis), Quality Food, Honestly Priced (Waitrose) |
| Website | John Lewis Partnership |
The John Lewis Partnership is a major United Kingdom retailer, operating department stores and, through its Waitrose subsidiary, upmarket supermarkets. Unusually, it is a public limited company that is held in trust on behalf of all its employees (called partners) - who all have a say in the running of the business and receive an annual profit distribution which is usually a significant addition to their annual salary. The chain's image is upmarket, and it appeals strongly to a middle class core of shoppers.
The partnership is an investor in and an operational partner of the Ocado internet grocery business, which supplies Waitrose brand food.
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[edit] History
The business was founded in 1864 when John Lewis set up a draper's shop in Oxford Street, London, which developed into a department store. In 1905 he bought the Peter Jones store in Sloane Square. In 1920 his son, John Spedan Lewis, expanded earlier power-sharing policies by sharing the profits the business made among the employees. The democratic nature and profit-sharing basis of the business were developed into a formal partnership structure and Spedan Lewis bequeathed the company to his employees. In January 2006, over 64,000 partners worked for the John Lewis Partnership, whereof the majority worked full-time.
The principle and slogan Never knowingly undersold was adopted in 1925. It was created by Spedan Lewis and applied to the company's Peter Jones store in Sloane Square, London. It stated that if a customer could buy the same item cheaper elsewhere they would refund the difference. Today, the company still honours this pledge, and many of their competitors also offer such a pledge. The principle has been more refined, most notably to exclude online shopping. However, they are the only large retailer that will match the price with any UK shop, not restricting it to a local area. The policy is also to monitor local competitors and reduce the shelf edge price if they are being 'undersold'. Staff (partners) also get paid £2 for every time they notify the company that they are being 'undersold'.
The present shop on Oxford Street was completed in 1960, the original buildings having been bombed during the war and gradually rebuilt. The sculpture Winged Figure by Barbara Hepworth was added in 1962.
On 27th April 1933 John Lewis Partnership bought Jessop & Son of Nottingham. This store was the first John Lewis outside London. The store kept the name 'Jessops' until 2002, when after a refurbishment and expansion the store was renamed as simply John Lewis. The partnership has also purchased a number of other regional department stores, as well as developing stores in new locations. As of 2005 it has plans to open a new department store every year for the next 10 years, which is probably the most ambitious expansion programme in its history.
In line with other British department store chains, it is nearing the completion of a process of renaming any stores not branded John Lewis (Tyrrell & Green, Heelas, etc.) with the nationally recognisable name. Peter Jones in London will remain the only exception to this policy when the premises of Robert Sayle and Knight & Lee are replaced with new department stores in Cambridge and Portsmouth respectively.
[edit] Organisation of the partnership
Every employee is a partner in the John Lewis Partnership, and has a possibility to influence the business through branch councils, which discuss local issues at every store. and the central Partnership Council, to which the partners elect at least 80% of the 82 representatives, while the chairman appoints the remaining. Waitrose has its own divisional council made up by representatives from each store. The council has the power to discuss ‘any matter whatsoever’, and is responsible for the non-commercial aspects of the business – the development of the social activities within the partnership and its charitable actions.
The Partnership Council also elects five of the directors on the partnership board (which is responsible for the commercial activities), while the chairman appoints another five. The two remaining board members are the chairman and the deputy chairman. In addition, there are two divisional councils for the two trading divisions (the department stores and Waitrose), where partners can exercise their influence, as well as a series of communications committees, appointed by non-management partners, which shall ensure that every non-management partner has an open channel for expressing his/her views to management and the chairman.
The John Lewis Partnership has a very extensive programme of social activities for its partners, including two large country estates with parklands, playing fields and tennis courts; a golf club; a sailing club with five cruising yachts; and two country hotels offering holiday accommodation for the partners. Partners are also enrolled in a very favourable pension scheme, receive a death in service insurance, and are given very generous holidays.
Finally, every partner receives an annual bonus, which is a share of the profit. It is calculated as a percentage of the salary, with the same percentage for everyone, from top management down to the shop floor and the storage rooms. Depending on the profitability of the partnership each year, the bonus has been between 9% and 18% of the partners' annual salaries since 2000. According to the preliminary result for the 2005-2006 financial year, which ended 28 January 2006, the partners will receive a bonus for that year which equals almost two months' salary. The remaining profit, after bonus payments and taxation, is always put back into in the business.
In 1999, in response to a fall in profits, there were calls from some Partners for the business to be demutualised and floated on the stock market. If this had gone through, each Partner would have been guaranteed a windfall of up to £100,000 each,in order to compensate them for their share of the business. In the end, no one on the Partnership Council agreed with the idea and only one member spoke in favour of a referendum on the issue. [2]
[edit] Financial performance
| Financial year | Turnover | Profit before tax | Net profit | Partner bonuses | Profit retained |
|---|---|---|---|---|---|
| 2006-2007 | £6.4 billion | £319.2 million | £319 million | £155 million (18%) | £164 million |
| 2005-2006 | £5,764.2 million | £251.8 million | £215.1 million | £120.3 million (15%) | £94.8 million |
| 2004-2005 | £5,333.6 million | £215.3 million | £175.9 million | £105.8 million (14%) | £70.1 million |
| 2003-2004 | £5,046.8 million | £173.5 million | £148.8 million | £87.3 million (12%) | £61.5 million |
| 2002-2003 | £4,679.3 million | £145.5 million | £108.6 million | £67.6 million (10%) | £41.0 million |
| 2001-2002 | £4,459.4 million | £141.5 million | £103.3 million | £57.3 million (9%) | £46.0 million |
| 2000-2001 | £4,126.6 million | £149.5 million | £120.4 million | £58.1 million (10%) | £62.3 million |
| 1999-2000 | £3,747.6 million | £194.7 million | £161.0 million | £77.8 million (15%) | £83.2 million |
The John Lewis Partnership's financial year runs from February to January the next year. The percentage figure in the bonus column shows the bonus' value in relation to a partner's salary. 8.33% would mean one additional month's salary and 16.66% would mean two months' salary, showing that the staff has received more than one month's additional salary as bonus each year since 2000.
In the 1983/4 year they broke the £100,000,000 barrier for the first time.
On Monday, 22nd of January 2007, John Lewis Edinburgh became one of the few shops in the UK to take over £100 million in one year. While not the first John Lewis store to reach this milestone, it is a huge achievement for the branch.
Financial section of John Lewis' website: [3].
[edit] Department store locations
As of January 2007 the John Lewis division operates 26 full-line department stores and a webstore. The stores are in a mixture of city centre and regional shopping centre locations. They are generally the largest or second largest department store in their local market. The flagship Oxford Street store in London remains the largest John Lewis outlet in the UK. [4]. In addition to the John Lewis department stores the partnership operates 5 Waitrose Food & Home stores combining the Waitrose format with a selection from the department store product ranges.
- Brent Cross, John Lewis Brent Cross
- Canary Wharf, Waitrose Food & Home Canary Wharf
- Croydon, Park Place (not yet confirmed, anticipated to open in 2011)
- Kingston upon Thames, John Lewis Kingston
- Oxford Street, John Lewis
- Sloane Square, Peter Jones
- Stratford (opening in 2010)
- Crawley (proposed new store, anticipated to open in 2012)
- Greenhithe, Bluewater, John Lewis Bluewater
- High Wycombe, John Lewis Home & Leisure High Wycombe
- Milton Keynes, John Lewis Milton Keynes
- Portsmouth (opening in 2009)
- Reading, John Lewis Reading (formerly Heelas)
- Southampton, John Lewis Southampton (formerly Tyrrell & Green)
- Southend on Sea, Waitrose Food & Home Southend on Sea
- Southsea, Knight & Lee (closing in 2009 to coincide with the opening of John Lewis Portsmouth)
- Watford, John Lewis Watford (formerly Trewins / Trewin Brothers)
- Welwyn Garden City, John Lewis Welwyn (formerly Welwyn Stores)
- Bristol, John Lewis Cribbs Causeway
- Cheltenham, Waitrose Food & Home Cheltenham
- Salisbury, Waitrose Food & Home Salisbury
- Cambridge, Robert Sayle (relocating to a new building in autumn 2007)
- Leicester (opening in autumn 2008)
- Norwich, John Lewis Norwich (formerly Bonds)
- Nottingham, John Lewis Nottingham (formerly Jessops)
- Oxford (opening in 2010)
- Peterborough, John Lewis Peterborough
- Rushden, Waitrose Food & Home Rushden
- Solihull, John Lewis Solihull
- Leeds (opening in 2011)
- Sheffield, John Lewis Sheffield (formerly Cole Brothers; relocating to a new development in 2010)
- Newcastle upon Tyne, John Lewis Newcastle (formerly Bainbridge)
- Cheadle, John Lewis Cheadle
- Liverpool, John Lewis Liverpool (formerly George Henry Lee; relocating to a new site in 2008)
- Preston, John Lewis Preston (under development)[2]
- Trafford, John Lewis Trafford
- Cardiff (opening in 2009)
- Sprucefield (opening in 2008, subject to planning)
[edit] Former locations
- Bristol, John Lewis Bristol (closed 1998 to coincide with the opening of John Lewis Cribbs Causeway)
- Brixton, Bon Marche (closed 1975)
- Brixton, Quin & Axten
- Edinburgh, The Silk Shop (fabrics and haberdashery; closed 1973 to coincide with the opening of John Lewis Edinburgh)
- Finchley Road, London, John Barnes (closed 1981, converted into what is now Waitrose Finchley Road, still commonly known as John Barnes)
- Gloucester, Blinkhorn & Son
- Harrogate, Buckleys
- Holloway, Jones Brothers (closed 1990)
- Hull, The Silk Shop Hull (closed 1956)
- Newcastle upon Tyne, The Silk Shop Newcastle upon Tyne (closed 1976)
- Peckham, Holdrons
- Peterborough, Robert Sayle Peterborough / Thomsons (closed 1956)
- Reading, A H Bull (closed 1953 to coincide with the acquisition of Heelas)
- Streatham, Pratts (closed 1990)
- Weston-super-Mare, Lance & Lance
- Windsor, Caleys (closed 2006)
[edit] Expansion
John Lewis has a major project of expansion underway with a number of new department stores planned to open between 2007 and 2011. In May 2005 a second John Lewis department store in the Manchester region opened at the Trafford Centre.
In June 2004, John Lewis announced plans to open its first store in Northern Ireland at the Sprucefield Park development, the province's largest out of town shopping centre, located outside Lisburn and ten miles from Belfast. The application was approved in June 2005 and the opening of the new store scheduled for 2008. This decision was disputed, however, and taken to the High Court where it was reversed. John Lewis is still hopeful of opening a new store at Sprucefield at the earliest opportunity.
Leicester will open in 2008 its 22,000 square metre store, in the Shires West development. [5]
Cardiff (planned, as part of the St Davids Centre — Phase 2 redevelopment), will open in 2009. It will be one of the biggest in the UK, at 260,000 sq ft. [6]
Oxford will open in 2010 as part of the redevelopment of the Westgate Centre.
Stratford will open in 2010 together with a new Waitrose supermarket. The new shops will anchor the Stratford City retail project being developed by Westfield alongside the Olympic Park in East London.
Leeds will open in 2011 as an anchor store of the planned Harewood & Eastgate Quarter development.
The opening of a new department store at the Tithebarn development in Preston was announced in January 2007.
John Lewis has declared an interest in establishing new stores in Croydon (2011) and Crawley (2012). Details of these openings are yet to be confirmed.
John Lewis will also relocate the Cambridge (2007) [7], Liverpool (2008) [8], Portsmouth (2009) [9] and Sheffield (2010) [10] stores to new, larger premises.
John Lewis in Oxford Street is currently undergoing a major refit called Project Beacon which will cost £60million and will finish in Autumn 2007.[http://www.johnlewis.com/Shops/DSTemplate.aspx?Id=33
[edit] Supermarkets
The John Lewis Partnership also owns Waitrose, an upmarket supermarket chain which has 184 branches (November 2006) and 35,573 (summer 2006) partners. Waitrose trades mainly in London and the South of England, and was originally formed by Wallace Waite, Arthur Rose and David Taylor. The company was taken over by The John Lewis Partnership in 1937. The acquisition of 19 Safeway branches in 2004 greatly increased the size of the company and saw branches open in the North of England for the first time. A further six stores were purchased from Morrisons in Autumn 2005 and again helped the march into previously unexplored territories. Then, in March 2006, Waitrose announced the purchase of five stores from Somerfield, with the first two stores in Scotland, both of which are in the capital, Edinburgh. In July 2006, Waitrose announced the purchase of six more stores and a distribution centre from Morrisons.
[edit] Credit Cards and Account (Store) Cards
Unusually, John Lewis department stores did not accept Visa and MasterCard credit cards until 1999, previously only accepting the John Lewis Account Card (a form of charge card) and the Switch (now Maestro) and Delta (now Visa Debit) debit cards.
On 28 March 2004, the John Lewis Partnership announced the launch of their own credit card [12] — the Partnership card. This was launched with HFC which is a division of the banking giant HSBC. It was launched as a MasterCard with a choice of four designs (effectively four different colours).
The credit card follows on from, and supersedes, the John Lewis (and Waitrose) account cards which have been around for 40 years. These cards are no longer available, and holders of these are being encouraged to replace them with the Partnership card. They can, however, still be used, and some cards from the mid-1970s are still in use.
The Partnership card is designed as a cashback credit card, with 6 months interest free credit and a low 15.5% APR. It offers a 1% rebate for purchases at stores that are members of the John Lewis Partnership — e.g. John Lewis, Waitrose, Ocado. For purchases at other stores it offers a rate of 0.5%. Points are awarded for spending inside the John Lewis Partnership stores (1 point for every £1 spent) and outside of the brand (1 point per £2 spent). Points are saved and vouchers are sent out quarterly with money back, these must be spent in a store of the John Lewis Partnership.
[edit] Direct services
On 3rd October 2006, the Partnership launched a new direct services company named Greenbee, providing home and travel insurance (with AXA), theatre tickets and travel services (in association with Expedia).
[edit] Notes
- ^ [1] Details of John Lewis' incorporation and current head office can be found at Companies House.
- ^ Lancashire Evening Post (January 25, 2007). Store puts city in retail premiership. Lancashire Evening Post.
