John Lewis to create 500 jobs in deal with Tesco for new online delivery hub

Partnership to lease one-million-square-foot distribution centre as part of renewed focus on online sales

John Lewis has announced a number of store closures as a result of the pandemic and shifts to online shopping (PA)

John Lewis is to lease a one-million-square-foot distribution centre from Tesco as it increases its focus on online sales. The partnership said the deal would create 500 jobs.

John Lewis is undergoing an overhaul under boss Sharon White who took over last year. It has closed 16 stores in the past year and cut around 3,700 jobs.

Web sales have surged and now account for 60 per cent of John Lewis’s revenues, compared to 40 per cent before the pandemic.

Announcing the deal with Tesco on Wednesday, Andrew Murphy, partner and executive director of operations at John Lewis, said: “This one-of-a-kind distribution centre represents a fantastic opportunity to power the continued growth of johnlewis.com, ensuring that we can keep pace with customer demand – both for our products and for our wide range of fulfilment and delivery options.

“We will invest in the site’s automation capability to support future growth and, over the next two years, we will recruit 500 new partners to work at the distribution centre, which we plan to start operating during summer 2022.

“We will use the Fenny Lock site to fulfil customer orders for fashion, small home furnishing items and technology products.”

The agreement with the supermarket for the site at Fenny Lock in Milton Keynes will run for 11 years. The site is four miles from the retailer’s largest distribution hub, which is two million square feet.

Mr Murphy said: “The proximity to our Magna Park campus will enable us to combine more customer orders, reducing both the number of packages we create by approximately one million per year, and the number of lorries on the road, helping us to meet our target of being net zero carbon by 2035.”

The company has committed to a £50m investment in its website and mobile app, with a further £100m due to be spent over five years for online growth.

A three-year lease agreement for a 300,000-square-foot distribution centre at Bardon, Leicestershire, with Clipper Logistics will be used later this month in preparation for Black Friday.

Additional reporting by PA Media