John Lewis: the future is own brand
John Lewis sees its future in differentiating itself from rivals through own brand products.
‘The structural changes in retail remain a challenge and an opportunity. Excess capacity of physical space coupled with subdued consumer confidence are adding to sales and margin pressure. In addition, a number of key operational costs continue to grow ahead of inflation. Our response is to build brands which remain consistently appealing to our customers so that we create more differentiated, valuable and long-term relationships with them,’ says Sir Charlie Mayfield, John Lewis Partnership chairman.
‘In John Lewis, we saw our strongest sales growth in areas in which we have made the greatest investment. We launched our second season of own-brand womenswear following the full redesign of our range last year; own-brand womenswear sales have grown 5.7%. In beauty, we also outperformed the market by 8.6%. In home, we are redesigning every part of our range and have started with the relaunch of upholstery. Having grown the size of our home design team by 50% over the last 18 months, we will launch 3,000 new own-brand products this autumn. In addition, this month sees the relaunch of own-brand menswear and the launch of our first ever own-brand gift food.
‘Should the UK leave the EU without a deal, we expect the effect to be significant and it will not be possible to mitigate that impact. In readiness, we have ensured our financial resilience and taken steps to increase our foreign currency hedging, to build stock where that is sensible, and to improve customs readiness. However, Brexit continues to weigh on consumer sentiment at a crucial time for the sector as we enter the peak trading period.’