2019 was a year to forget for retailers. Trading in the run up to Christmas was the worst since 2008 when the UK was in the grips of a recession.
That’s the view British Retail Consortium, which has been pulling together the sales data of its members since 1995.
Money is moving online, the competition between retailers is ferocious. The sales now begin well before Christmas but by cutting prices retailers also cut their profit margins.
- Joel Hills explains why 2019 was a year to forget for most retailers
The John Lewis Christmas advert featured an accident prone dragon and proved popular but, ultimately, the department store’s profits went up in smoke. The Partnership’s “Never Knowingly Undersold” promise compelled it to match the heavy discounting.
Waitrose performed well but full year profit at the department stores will be “substantially down” on 2018 (a bad year).
The Partnership says its on course to make “significantly” less than the £160m it reported last March. John Lewis’s 81,500 staff are advised that they may not receive a bonus this year for the first time since 1953.
The executive who runs John Lewis’s department stores is now leaving.
Charlie Mayfield, the chairman of the partnership, repeatedly refused to deny that she has been sacked.
“We both reflected on the position and decided together that now was time for her to step away,” he insisted.
John Lewis has reasons to be optimistic. It has loyal customers, strong brands and has cut costs and reduced its debts but the steady decline in sales need to be reversed. The incoming chairman, Dame Sharon White, may decide there is a need for a more radical response.
Last year a host of traditional high street names ended up insolvent, including: Jessops, Clintons, Joy, Swoon, Mothercare, Mamas and Papas, Forever 21, Bonmarche, Jack Wills, LK Bennett, Oddbins and Debenhams.
Excluding food, one pound in every three that is spent is now spent online, five years ago it was one in six.
The trend is established, the upheaval is set to continue.