John Lewis is gunning to become the largest home retailer as it seeks to topple market leader Ikea.
John Lewis is ranked second by market share at present, and boss Andy Street said the department store retailer is closing the gap between it and the Swedish furniture giant.
“We are determined to overtake them and get to that market-leading position,” said Street.
Home sales grew 2.3% in the year to January 25 while market share has increased from 3.6% in 2008 to 5.2% in 2013. “Against a flat market we’ve decisively outperformed,” said Street.
John Lewis operating profits before restructuring costs were up 11% to £240.5m, while total sales jumped 7.5% to £4.06bn. Like-for-likes increased 6.4%.
Street said John Lewis outperformed across all its categories but said electricals and home technology was the best performing segment after the retailer established strong relationships with leading brands including Apple and Samsung. Sales in the category soared 15.5%.
Fashion sales increased 5%, driven by a strong performance in own-brand.
Online sales were up 19.2% and now represent 29% of total revenue, which Street said is “well ahead of our bricks-and-clicks competitors”. He added that its strong click-and-collect offer had helped drive sales through the channel, particularly its tie-up with Waitrose that enables John Lewis shoppers to pick up from the grocer’s stores. “We’ve hit a rich vein in terms of convenience,” said Street.
The retailer is also piloting a mobile EPoS system in a handful of stores in a bid to up its service credentials.
The initiative aims to save shoppers time as they do not have to queue at tills. Street said: “We’re trying to make shops more relevant for the future.”
John Lewis will invest £225m in the business this year, up from £175m last year. Money will be invested into distribution and IT in particular, as well as stores.