Holiday web sales jump 21% for UK retailer John Lewis

January 6, 2016 11:37 AM

(Bloomberg)—John Lewis tapped into British shoppers’ growing penchant for online shopping over Christmas, fueling sales growth at the U.K.’s biggest department store chain as most retailers struggled.

Web sales rose 21% in the six weeks ended Jan. 2, the employee-owned company said Wednesday, more than making up for a decline in store-based revenue.

John Lewis’s performance enabled the company to maintain its full-year profit forecast at a time when many retailers are finding growth hard to come by. Marks & Spencer Group Plc is expected by analysts to report a drop in quarterly sales on Thursday. Online sales accounted for 40% of John Lewis’s revenue over the holiday period, up from 36% a year ago, following years of investment in distribution and information systems. John Lewis is No. 11 in the Internet Retailer 2015 Europe 500.

“John Lewis’s trading statement is a perfect microcosm of what is occurring in mainstream retail right now: in-store it’s very tough, but online growth is strong,” Jonathan Pritchard, an analyst at Peel Hunt, said in a note.

John Lewis’s performance over Christmas is likely to be among the best in the industry. The retailer has been at the forefront of a shift toward online ordering, with sales of items collected in-store gaining 16% and representing half of all orders.

Clothing growth

Total sales at John Lewis rose 6.9% to 951 million pounds ($1.4 billion) in the holiday period, even though sales at the retailer’s stores fell 1.2%. All departments contributed to the growth, including clothing, where many retailers saw sales slide because of mild November and December weather.

The post-holiday clearance was particularly strong, with sales gaining 23% in the week ended Jan. 2, the company said.

John Lewis department stores are part of a partnership that also includes Waitrose supermarkets. Same-store sales at Waitrose fell 1.4% in the six-week period as the chain fought to combat a market dominated by the growth of discounters.




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