Economic slowdown hits home at John Lewis with fall in sales

Sales at John Lewis took a hit last week, providing further evidence of a slowdown on the high street as consumers tighten their belts.

The department store chain, which is operated as a partnership and owned by its staff, appeared fairly resilient towards the end of 2007 and enjoyed a record Christmas.

However, the company has got off to a slow start this year and reported a 1.4 per cent fall in sales for the week to 8 March. This compares to a 6.1 per cent rise in the same week last year. Although sales rose the preceding week, in the week to 16 February sales fell 3.4 per cent.

John Lewis's figures were released a day after Terry Dudd, the chief executive of Home Retail, which owns Argos and the DIY chain Homebase, warned of tougher times ahead and said recent cuts in interest rates had had little impact on sales.

Howard Archer, chief economist at Global Insight, said the latest figures from John Lewis "reinforce suspicions that the UK consumer will rein in his spending significantly over the coming months".

"It is obviously dangerous to read too much into one week's figures for one chain, and John Lewis highlighted that sales in the latest week could well have been held back by a number of factors," he said. "Nevertheless, the John Lewis department store sales are generally seen as a good bellwether for the health of consumer spending and they have shown clear overall signs of softening in recent weeks."

He added: "Significantly, John Lewis indicated that sales of furniture and floor coverings are suffering in particular. A weakening housing market not only weighs down on consumer spending through softer prices having an adverse wealth effect, but also through reduced housing market activity diluting demand for home furnishings and appliances."

Eric Gregory, personnel director at John Lewis, said it had been a difficult week for comparisons due to Mother's Day falling on the Sunday, the unseasonable weather and a raft of sporting events on the Saturday, including the Six Nations rugby and FA Cup football.

"While trade was up overall for the other six days combined, it was not enough to compensate for the shortfall on Sunday and as a result we ended the week slightly down on last year," he said. However, he added that although fashion was ahead of last year with strong sales in womenswear driving growth, "the general economic slowdown, particularly that in the housing market, continues to test our home merchandise sales of furniture and floor coverings".

Overall, sales grew 3.2 per cent at the John Lewis Partnership, as its 187-strong supermarket chain Waitrose continued to perform well.

Last week, John Lewis staff celebrated the award of one-fifth of their salary as an annual bonus after the partnership reported an 18.7 per cent rise in profits for 2007. However, the group warned its stores face challenging conditions for the rest of this year.

News
A 1930 image of the Karl Albrecht Spiritousen and Lebensmittel shop, Essen. The shop was opened by Karl and Theo Albrecht’s mother; the brothers later founded Aldi
people
Arts and Entertainment
Standing the test of time: Michael J Fox and Christopher Lloyd in 'Back to the Future'
filmA cult movie event aims to immerse audiences of 80,000 in ‘Back to the Future’. But has it lost its magic?
Arts and Entertainment
Flora Spencer-Longhurst as Lavinia, William Houston as Titus Andronicus and Dyfan Dwyfor as Lucius
theatreThe Shakespeare play that proved too much for more than 100 people
News
exclusivePunk icon Viv Albertine on Sid Vicious, complacent white men, and why free love led to rape
PROMOTED VIDEO
Arts and Entertainment
Stir crazy: Noel Fielding in 'Luxury Comedy 2: Tales from Painted Hawaii'
comedyAs ‘Luxury Comedy’ returns, Noel Fielding on why mainstream success scares him and what the future holds for 'The Boosh'
Life and Style
Flow chart: Karl Landsteiner discovered blood types in 1900, yet scientists have still not come up with an explanation for their existence
lifeAll of us have one. Yet even now, it’s a matter of debate what they’re for
Arts and Entertainment
'Weird Al' Yankovic, or Alfred Matthew, at the 2014 Los Angeles Film Festival Screening of
musicHis latest video is an ode to good grammar. But what do our experts think he’s missed out?
Sport
New Real Madrid signing James Rodríguez with club president Florentino Perez
sportColombian World Cup star completes £63m move to Spain
Travel
Hotel Tour d’Auvergne in Paris launches pay-what-you-want
travelIt seems fraught with financial risk, but the policy has its benefits
Arts and Entertainment
booksThe best children's books for this summer
Life and Style
News to me: family events were recorded in the personal columns
techFamily events used to be marked in the personal columns. But now Facebook has usurped that
News
ebookA unique anthology of reporting and analysis of a crucial period of history
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Programme Director - Conduct Risk - London

£850 - £950 per day: Orgtel: Programme Director - Conduct Risk - Banking - £85...

Business Analyst (Agile, SDLC, software)

£45000 - £50000 Per Annum + excellent benefits: Clearwater People Solutions Lt...

Finance Manager - Bank - Leeds - £300/day

£250 - £300 per day + competitive: Orgtel: Finance Manager - Accountant - Bank...

Compliance Officer - CF10, CF11, Compliance Oversight, AML, FX

£100000 - £120000 per annum + BONUS + BENEFITS: Harrington Starr: A leading fi...

Day In a Page

Noel Fielding's 'Luxury Comedy': A land of the outright bizarre

Noel Fielding's 'Luxury Comedy'

A land of the outright bizarre
What are the worst 'Word Crimes'?

What are the worst 'Word Crimes'?

‘Weird Al’ Yankovic's latest video is an ode to good grammar. But what do The Independent’s experts think he’s missed out?
Can Secret Cinema sell 80,000 'Back to the Future' tickets?

The worst kept secret in cinema

A cult movie event aims to immerse audiences of 80,000 in ‘Back to the Future’. But has it lost its magic?
Facebook: The new hatched, matched and dispatched

The new hatched, matched and dispatched

Family events used to be marked in the personal columns. But now Facebook has usurped the ‘Births, Deaths and Marriages’ announcements
Why do we have blood types?

Are you my type?

All of us have one but probably never wondered why. Yet even now, a century after blood types were discovered, it’s a matter of debate what they’re for
Honesty box hotels: You decide how much you pay

Honesty box hotels

Five hotels in Paris now allow guests to pay only what they think their stay was worth. It seems fraught with financial risk, but the honesty policy has its benefit
Commonwealth Games 2014: Why weight of pressure rests easy on Michael Jamieson’s shoulders

Michael Jamieson: Why weight of pressure rests easy on his shoulders

The Scottish swimmer is ready for ‘the biggest race of my life’ at the Commonwealth Games
Some are reformed drug addicts. Some are single mums. All are on benefits. But now these so-called 'scroungers’ are fighting back

The 'scroungers’ fight back

The welfare claimants battling to alter stereotypes
Amazing video shows Nasa 'flame extinguishment experiment' in action

Fireballs in space

Amazing video shows Nasa's 'flame extinguishment experiment' in action
A Bible for billionaires

A Bible for billionaires

Find out why America's richest men are reading John Brookes
Paranoid parenting is on the rise - and our children are suffering because of it

Paranoid parenting is on the rise

And our children are suffering because of it
For sale: Island where the Magna Carta was sealed

Magna Carta Island goes on sale

Yours for a cool £4m
Phone hacking scandal special report: The slide into crime at the 'News of the World'

The hacker's tale: the slide into crime at the 'News of the World'

Glenn Mulcaire was jailed for six months for intercepting phone messages. James Hanning tells his story in a new book. This is an extract
We flinch, but there are degrees of paedophilia

We flinch, but there are degrees of paedophilia

Child abusers are not all the same, yet the idea of treating them differently in relation to the severity of their crimes has somehow become controversial
The truth about conspiracy theories is that some require considering

The truth about conspiracy theories is that some require considering

For instance, did Isis kill the Israeli teenagers to trigger a war, asks Patrick Cockburn