Newcastle misses out on John Lewis call centre jobs

Dec 1 2009 By The Journal

HOPES that John Lewis would open a call centre in Newcastle and create hundreds of jobs have been dashed.

The department store group had shortlisted Newcastle and Manchester for a new English centre which would centralise its customer services operation.

The group, which already employs 825 staff at its Eldon Square store, plans to shut the call centres it runs in each of its 25 branches in the UK with the loss of 720 jobs nationwide, including 20 in Newcastle. But yesterday it revealed that it had picked Didsbury in south Manchester for the new centre which will employ 240 people alongside a similar call centre near Glasgow.

Andrew Murphy, director of operational development at John Lewis, said: "The decision to choose Manchester over Newcastle was not an easy one, as both locations offered strong opportunities for the second centre. In the end, the decision came down to the availability of an excellent property to meet our business needs."

The centres will deal with all of the company’s customer enquiries, particularly those connected to its online trade, currently up £1m on last year.

The staff that are being laid off will be given the option of relocating to one of the new centres or being redeployed as shopfloor workers.

The cost-cutting move comes just two months after the chain showed just how hard it is being hit by the economic downturn.

Profits fell by more than 50% in the first half of this year. The stores made operating profits of £21m in the six months to August – down from £43m over the same period in 2008 and £54m in 2007.

Sales of "big-ticket" home ranges, which are directly linked to the number of people moving home, were down more than 8%. Home wares account for more than a third of sales.

But last week the retailer said it saw a change in the trend with record sales of televisions as trading gathers momentum in the run-up to Christmas.

The performance topped another strong week for electrical and home technology goods, the department store chain said.

As well as Christmas gift-buying, the comments are a further sign that consumers are bringing forward big-ticket purchases before VAT goes back up to 17.5% in January.