John Lewis is cutting almost 400 jobs as customers shift to online shopping

LONDON — Department store John Lewis will cut almost 400 jobs across its cafes and home fittings departments, as customers shift their spending from physical stores to online shopping.

The company said that 387 jobs would go as a result of the restructuring.

Around 773 staff had entered redundancy consultation and been given the opportunity to apply for 386 new roles, John Lewis said. The changes will affect 32 of its 48 stores.

Dino Rocos, John Lewis operations director, said: “These proposals will allow us to modernise our business as it adapts to the changing needs of our customers and the role that shops play in their lives.” 

The company said it would roll out a new catering model that requires fewer staff across its stores.

“The new catering model uses a centrally created menu with high-quality ingredients and requires less ‘on-site’ preparation. This new model will enable us to change our menu more regularly to keep up with trends, more easily meet the dietary requirements of customers, and give a more consistent offering across all of our shops,” John Lewis said. 

John Lewis is facing both a shift to online shopping and a weaker pound as a result of the June Brexit vote, which makes imported goods more expensive. More than 40% of sales at John Lewis over Christmas were online.

The John Lewis Partnership, which also owns Waitrose, said in January that annual bonuses for staff would be “significantly lower” in 2017 because of “the challenging market outlook, our determination to maintain a strong balance sheet and our commitment to accelerating our strategy.” 

Staff received 10% of their salary as a bonus in 2016.

The company cited “the channel shift from shops to online,” as a dampener on profit. “The other major influence is pricing, where deflation continues in food and non-food, despite rising input costs as a result of weakness in the Sterling exchange rate.”

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