British department store chain John Lewis recently said that it would close about eight stores in the UK. The move is expected to put around 1,300 jobs at risk in another blow to the UK retail sector.
The recent layoffs and cost cutting measures in the retail sector are a result of the impact of the coronavirus pandemic on business as more and more customers are shifting to online shopping.
Recently, British luxury store Harrods said it would cut about 7,00 jobs at its flagship store in London. Meanwhile, British coffee shop chain Pret A Manger also said it would shut 30 of its stores in the UK and could cut about 1,000 jobs.
John Lewis said the closures will include two major outlets in Birmingham and Watford as it would continue to invest heavily in e-commerce, with online sales looking set to represent around 60 to 70% of total sales this year and next, compared with 40% prior to the COVID-19 crisis.
UK retailers have been hammered by the lockdown and data shows that shoppers remain wary of entering stores even as the restrictions ease, with footfall down 50% year on year during the third week of reopening in England and Northern Ireland, according to the British Retail Consortium.
The coronavirus pandemic has heaped additional problems onto many retailers who were already struggling due to tight margins, competition from online-only stores and the cost of business rate taxes.
John Lewis said the eight department stores had already struggled financially prior to the lockdown.
“We believe closures are necessary to help us secure the sustainability of the partnership – and continue to meet the needs of our customers however and wherever they want to shop,” said Sharon White, chairman of the John Lewis Partnership.
“Redundancies are always an absolute last resort and we will do everything we can to keep as many Partners as possible within our business,” she said, with one option moving some staff to its Waitrose supermarket or online operations.
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