John Lewis Profits Surge, but Staff Bonus Scrapped for Third Year

Employee-Owned Retailer Focuses on Investment Over Bonuses

The John Lewis Partnership (JLP) has reported a 73% rise in annual profits, yet staff will go without a bonus for the third consecutive year.

The employee-owned business, which operates John Lewis department stores and Waitrose supermarkets, recorded earnings of £97 million for the year ending January 2025, up from £56 million the previous year. Sales rose by 3% to £12.8 billion, driven primarily by Waitrose and the reinstatement of John Lewis' 'Never Knowingly Undersold' price promise.

Despite this strong financial performance, the company’s new chairman, Jason Tarry, has decided to prioritise investment in the business over paying staff bonuses.

Why No Bonus for Staff?

For only the fourth time since 1953, JLP has opted not to issue a staff bonus, instead focusing on wage increases and business growth.

• A 7.4% pay rise for staff was introduced earlier this month to improve retention.
• The company will invest £600 million in store upgrades, supply chain improvements, and future growth.

Mr Tarry, who replaced Dame Sharon White six months ago, explained that while a bonus was considered, long-term investment is the priority.

"These are solid results, which show that our customers are responding well to our investments in quality products, value, and service," he told JLP’s 69,000 partners.

He added that the company sees significant opportunities for growth and will focus on enhancing its unique appeal to customers.

Challenges Ahead for John Lewis Partnership

While the company has made progress in its post-pandemic recovery, challenges remain:

• Economic uncertainty could impact customer spending in the coming year.
• JLP faces a £45 million hit from the rise in employer national insurance contributions next month.
• Mr Tarry warned that a staff bonus in the next financial year is not guaranteed, depending on the economic climate.

However, he reassured that the company will not pass costs onto customers through price increases, instead managing the impact through cost savings and growth strategies.

Conclusion: A Long-Term Growth Strategy

John Lewis Partnership is at a turning point—choosing long-term investment over short-term rewards. While some staff may be disappointed, the company believes that strengthening operations, improving pay, and upgrading stores will deliver sustained success.

If these strategies boost growth and customer confidence, a return of staff bonuses could still be on the horizon in the coming years.

For now, JLP’s focus remains on ensuring a strong and competitive future in the retail industry.

Sources: (SkyMoney.com, ChatGPT)