New John Lewis boss signals further cuts and price rises

Newly appointed John Lewis (LON:BD32) boss Paula Nickolds has said that the department store needs to modernise if it is to stay ahead of the retail curve.

Nickolds, who took over the position in January of this year, is the first female to be at the helm of the department store which has been in operation since 1864.

Whilst John Lewis continues to operate well financially, Nickolds emphasised the necessity of the company to continue to adapt to changing consumer habits. She commented recently: “I’ve inherited a business in really good shape, but we need to change,”, recognising the “volatile environment” in light of Brexit uncertainty and rising prices.

Nickolds highlighted the challenge for the retail industry with shoppers moving increasingly taking to online platforms to do their shopping and purchasing, which in turn, has put strain upon businesses to accommodate these rapidly occurring changes in consumer patterns.

Similarly, the impending Brexit negotiations were also have a significant impact upon retail for the department store and other high-street brands. Pound devaluation in the months succeeding the June referendum has led to surges in prices for retailers. Indeed, the sterling continues to be turbulent as the government moved to trigger Article 50 on Wednesday.

“Customers are feeling a little less certain of their financial security and that is starting to come through in our conversations [with them],” she said, adding this was likely to materialise in the upcoming year.

She added: “The two most significant concerns over the next couple of years are our trading arrangements and at least as important, and probably more so, is the experience for EU nationals working in John Lewis.”

Last month, the retail giant announced plans to cut almost 800 jobs, in order to emerge as a more cost-effective business. Similarly, its sister supermarket brand Waitrose announced its intention to close six of its locations across the U.K.