Festive sales start slow at John Lewis

Nov 17 2007 by Peter McCusker, The Journal

DEPARTMENT store chain John Lewis added to concerns over the high street spending crunch yesterday after slowing sales last week.

The retailer saw sales move ahead just 1.8% in the seven days to November 10 – lower than the overall 2.3% seen in the 15 weeks of the financial year so far.

Although colder weather helped clothing, and there were strong sales of iPods and laptops, the department store chain said it had seen a “quiet start” to the week before sales picked up.

Sales across the partnership as a whole, which also owns the Waitrose supermarket chain, were up 3.4% over the week –again below the 4.5% growth across the 15 weeks. The pressure adds to fears of a tough Christmas for retailers, with shoppers reining in spending as five interest rate hikes in 15 months filter through to mortgage payments.

Sales volumes fell for the first time in nine months during October despite discounting to tempt would-be customers, official figures showed yesterday.

Despite the signs of easing growth, John Lewis, with a branch in Eldon Square, Newcastle, said it was “very well-placed” in the lead-up to Christmas.

This week the department store turned to television advertising for only the second time in its history with the launch of its pre-Christmas marketing campaign.

The campaign’s £6.2m budget is more than triple the amount spent last year by the retailer.

This week’s figures also showed Waitrose failing to sparkle despite Guy Fawkes fireworks giving a sales lift. The 5.1% sales increase was below the 6.3% seen so far this year.

The supermarket’s supply chain director Mark Williamson described the performance as a “solid week of sales” but added: “Hopefully we can push on to a higher level.”

The John Lewis partnership, which is wholly owned by its staff, has 26 department stores across the UK and 186 Waitrose supermarkets.