Does the announcement last week by John Lewis that it will start to charge for small click-and-collect orders signal a change in the industry?
Last week John Lewis announced it will start charging for small click-and-collect orders.
From a financial perspective, it’s no surprise one of the UK’s largest retailers has called time on free click-and-collect. When the retailer announced the move last week, boss Andy Street said the model is “unsustainable”, and the company will now charge for click and collect orders under £30.
“We want to take a leadership position. This market has got to be sustainable. It’s illogical this can be produced at no cost. We think our customers will understand this is reasonable,” Street said at John Lewis’ Christmas in July event last week.
But considering the offering across the rest of the industry, it is a bold move.
The UK retailer’s main competitors, including House of Fraser, still offer free click-and-collect, but many may wish to make the move soon too. For most retailers, click-and-collect is not simply a case of packaging up something that is already on a shelf in store, it requires transporting products from one location to another, storing them and arranging for customer collection.
And as customers’ fulfilment demands increase, so too will retailers costs. Street is right that the current models are unsustainable when offered for free, particularly in light of the spending frenzy that was Black Friday and Christmas trading last year, much of which was purchased online.
John Lewis is a high street stalwart, but the company is also an innovator, and while they are certainly not the first to charge for click-and-collect, the decision to make the move may well signify a change in thinking across the high street towards charging more for delivery, whatever form that might take.
Fulfilment is rarely easy for retailers, and it’s never free. The challenge for retailers is how to remain competitive when there will always be someone prepared to offer a cheaper delivery alternative.