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March 16, 2023: John Lewis Partnership, the owner of John Lewis department stores and Waitrose, is facing a decline in results, with the company expected to report its second full-year loss in March. The cost of living crisis has hit even Waitrose’s affluent customers, and strategic missteps, such as the late advertising of its Essentials range and the introduction of small stores, have also contributed to the decline. As a result, the company is shaking up its management team and bringing in Nish Kankiwala, a former executive of Hovis and Burger King, as its first group CEO. Kankiwala, who has little retail pedigree but extensive brand experience, will replace the previous CEO, Pippa Wicks, who unexpectedly left last month. The company is widely expected to report an annual pre-tax loss of over $60m, compared to a profit of $219m last year.
Kankiwala’s appointment is a big gamble for the company in a high-stakes game. Until recently, John Lewis was the department store anchor that every mall wanted, and Waitrose’s arrival signalled the gentrification of an area was complete. Partners also enjoyed an annual bonus, but workers are expected to miss out on the bonus for the second time in three years. The management team has also seen high-profile departures, and the sudden exit of Pippa Wicks, the architect of smaller John Lewis outlets, has raised questions about the company’s future plans.
The company has pushed ahead with private rental apartments above Waitrose stores and other real estates as a new revenue stream, but this is a completely new venture for the business. The new structure allows partnership chair Sharon White to focus on the preservation of the partnership model and the company’s distinctive character, on the strategy for the partnership, and on its big commercial choices. Kankiwala will be joined by five other directors, including retail director Naomi Simcock and finance director Bérangère Michel, who will report directly to him. Zaka Mian, the transformation and technology officer, has also taken over some of the responsibilities of chief operating officer Andrew Murphy, who is due to leave this summer.
