John Lewis culls a third of top jobs as part of a radical overhaul at HQ to save £100m
A third of senior managers face the chop in an overhaul at the John Lewis Partnership.
Department store chain John Lewis and its supermarket arm Waitrose will be run by a single team to streamline and save cash.
The shake-up will see 75 of 225 head office management roles axed in a bid to find £100million of savings.
Waitrose boss Rob Collins, left, has been axed, while Paula Nickolds will be catapulted into a new role as executive director of brand covering both the department store and supermarket
The most high-profile casualty is Waitrose boss Rob Collins, who joined the supermarket as a graduate trainee in 1993.
Paula Nickolds, previously John Lewis managing director, will be catapulted into a new role as executive director of brand covering both the department store and supermarket.
She will be part of a slimmed down executive team made up of seven new director roles with responsibilities across the whole group.
The overhaul comes a few months before Sharon White takes over as chairman of the partnership from departing boss Sir Charlie Mayfield.
White, who is currently chief executive of media regulator Ofcom, will become the first black woman to chair a large British retailer.
She joins at a difficult time for the group. Staff bonuses were this year cut to their lowest since 1953 and the group recently clocked up its first half-year loss since 1972.
Bosses said the shake-up was needed to ‘break the cycle of declining returns’ hitting the High Street.
A consultation on the job losses will start now, with the new executive structure coming in from February.
There will be ‘little or no disruption’ in shops and there will be no staff job losses in-store, the company said.
The partnership said bringing the businesses together would help to roll out services suitable for both brands, such as click-and-collect.
The partnership said eight in ten customers who ‘account for the greatest sales’ are regular customers of both John Lewis and Waitrose.
Some IT and supply chain platforms will also be merged to save costs.
Mayfield said the group needed to take ‘bolder steps’ to turn around its fortunes in a difficult market.
He said: ‘Although there will be little or no disruption to our shops or websites in the near term, there will be considerable change in many other areas of the partnership as we bring the two businesses much closer together.
‘These are necessary and these changes will be difficult for some of our partners, and we will implement them as carefully and sensitively as we can.’
He added: ‘We are confident, as a board, that when the programme is complete, the partnership will be better positioned to break out from the cycle of declining returns that are affecting most established retailers.’
Both head offices – in Bracknell for Waitrose and Victoria in London for John Lewis – are expected to remain open. It comes amid rapidly falling profits at John Lewis, down from £540million two years ago to £160million last year.
In March the partnership bonus paid to employees was cut to its lowest level since 1953. The business made a loss of £25.9million in the six months to the end of July, the first half-year loss since 1972.
Sales growth slowed to 1 per cent in the year to January 2019 across both brands, but shrunk 1.4 per cent in department stores.
Some analysts even questioned whether the company would have to ditch its Never Knowingly Undersold price pledge.
Collins was said to be a ‘central architect’ of the new plans. Mayfield added: ‘It’s a testament to his character that his commitment to the right course for the Partnership has not wavered despite his own role being removed in the new structure.’
Patrick Lewis, the great-grandson of John Lewis’s founder, will become finance chief.
There are 50 John Lewis department stores and, after 12 closures this summer, there are 344 Waitrose supermarkets. The business has 81,500 staff.