Tough choices ahead at struggling John Lewis

tHE John Lewis Partnership faces ‘hard decisions’ as the retailer prepares to unveil a half-year loss.

Analysts are expecting a bleak set of results on thursday, with the retail group forecast to reveal it has swung into the red during the six months to the end of July.

One analyst predicted the partnership would be left nursing a loss of £15m. that would be even worse than last year, when it shocked the industry by revealing it had made just £1m profit.

the John Lewis Partnership, which runs its namesake department stores as well as the Waitrose supermarket chain, has been laid low partly because of brutal competition.

struggling department store rivals such as House Of Fraser and Debenhams have been heavily discounting this year, forcing John Lewis to follow suit, while Waitrose has seen sales slide as supermarkets feel the squeeze from insurgent German rivals Aldi and Lidl.

Last month, research consultancy Kantar warned that both Waitrose’s sales and its market share were shrinking.

the results this week are set to further underline the stark challenges facing sharon White ( pictured), the current boss of media regulator Ofcom who takes over from outgoing John Lewis Partnership chairman sir Charlie Mayfield next year.

Richard Hyman, an independent retail analyst, said the partnership faced ‘unprecedented competitive pressure’ and that White, 52, would ‘inevitably’ have to grapple with further cuts to its portfolio of some 400 shops.

Waitrose said in July that it planned to close three stores and sell another four. And John Lewis, which is run by managing director Paula Nickolds, confirmed in January it was set to close a department store for the first time in 13 years.

Hyman added: ‘John Lewis will soon be bringing in more than half of its sales from online, and yet it has still been opening stores. it needs fewer stores, not more, so there are going to be some hard decisions for sharon White to make. Frankly, it’s inevitable there will be more closures.

‘the overwhelming majority of UK retailers have still got far too many stores, and John Lewis is no exception.

‘What White may find, though, is that one of the things that makes the John Lewis Partnership strong – its democratic culture – may sometimes be a weakness.

‘they need to increase the pace of decision-making – there is a great need right now in the industry to be able to move faster than ever before.’

Fellow retail analyst Nick Bubb, who predicted that the John Lewis Partnership would post a first-half loss of £15m, told the Mail on sunday that one silver lining was profits at Waitrose may have ‘held up quite well’.

A spokesman for the John Lewis Partnership declined to comment last night.