John Lewis chairman Charlie Mayfield has defended the retailer’s warning that bonuses rewarded to its partners will be “significantly lower” this year.
“It will not all be brand new,” he said of the retailer’s aim to “accelerate aspects” of its strategy.
”We are accelerating some of the themes we have already spoken about,” he added. “We are investing more in product and more in existing stores than new ones.
“And we will have fewer partners over time, that is very likely. That is something that has been happening already. If you look at the adjusted sales per partner over the past five to six years, we have seen productivity increase.”
Mayfield said that the coming year would bring multiple challenges for retailers, but added that currency headwinds were like “a dog that hasn’t really barked” yet.
He said that the question over whether customers, retailers or suppliers would absorb the extra costs was “quite literally the several hundred million-pound question”.
However, Mayfield reaffirmed his belief that retailers would absorb the bulk of extra costs due to the intensely price-competitive nature of the industry and suggested that, if consumers were to shoulder the burden, retailers would see “dampened demand.”