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09 July 2020 20:37

John Lewis & Partners Coronavirus BBC

john lewis store closures

Everyone I've spoken to today from business experts to retail analysts have said the same thing - if John Lewis does close down its Birmingham store it would be a huge blow. Let's first and foremost acknowledge it would be a huge blow for the people who work at the stores at Grand Central in Birmingham and at Tamworth. They're being offered jobs at Waitrose stores, at John Lewis online or three thousand pounds worth of re-training, but today is a tough day for hundreds of midlands families who work for John Lewis. But the negative ripples will be felt right across the high street - just as the positive ripples were felt when John Lewis said they were coming to Grand Central. It's often said that a John Lewis or a Waitrose can move the dial on house prices in an area - almost as much as there being a good school in the neighbourhood.

Mark Gough: If John Lewis closes in Birmingham, negative ripples will be felt across the high street

But the John Lewis factor is real. I spent many hours chatting to the developers at Grand Central when it was being built and John Lewis was the lynchpin of that development. if you get John Lewis, then other retailers will flock there too, knowing there's guaranteed footfall. At the time I spoke to one clothes manufacturer who were holding off opening their first shop ever - in Grand Central until they knew John Lewis were coming. As soon as John Lewis signed, they signed up too. That's not to say the converse is true - that just because John Lewis would close then the smaller shops will flood out of Grand Central. Grand Central has been a huge success - but we are now in very different times. The high street was already struggling. Grand Central is built on top of a train station - but because of Covid-19 many fewer people are taking the train. John Lewis today admitted that the Tamworth and Grand Central stores were already "financially challenged". In other words, they weren't making money. 40% Before Covid-19 the amount of the business made up of online sales 60 - 70% Now: online sales have jumped to make up far more of the business What is pulling money in is the John Lewis website. Before Covid-19 online sales at John Lewis accounted for 40 per cent of the business. Now that's nearer to 60-70 per cent - and John Lewis say it'll probably stay at that this year and next. Just think about that - John Lewis is mostly an online business now and will continue to be so. My expectation is that will only grow and John Lewis today acknowledged that some employees will be offered work in those call centres. The good news for the Midlands is that John Lewis in Leicester is staying open. But that hardly offsets to 4000 jobs Boots in Nottingham said it's cutting - admittedly not all at the Nottingham HQ although support staff there will be heavily affected, so too will people who work in the opticians stores and on beauty and make up counters on the high street. The tragedy once again for the Midlands - on top of job losses at Rolls Royce in Derby and at Jaguar Land Rover and DHL recently - is that tonight many more hundreds of people will be out of work and chasing fewer and fewer jobs.