John Lewis Department Store is a very particular company, 100% employee owned, often described as a model of responsible capitalism, with a written constitution that condemns the obsession with maximizing profits and says that profits are only to be “reasonable and sufficient”. A model and a kind of utopia that, with so many financial wolves around it, is now in danger of passing away.
Since its founding in 1864 as a cloth business on Oxford Street, John Lewis has prospered greatly, becoming the go-to department store for the wealthy British middle classes, the place where wedding lists were made, trousseau was bought when the children married and the purchases were made when the grandchildren were coming. The poet John Betjeman said that if the end of the world came, he wanted to be caught in the household section of the Sloane Square (London) branch, "because nothing unpleasant ever happens there."
But no one escapes unpleasantness and difficult times, and now it is the turn of John Lewis like so many wholesalers, who are being killed by Amazon with their exploitation of technology, the post-pandemic obsession with online shopping, inflation and the cost of living crisis. In the last year its sales volume (15,000 million euros) was two percent lower than the previous year, with losses of 250 million and a debt of 1,200 million.
There are those who are betting that the company will weather the storm by making cuts (a billion euros have already been made), closing establishments (one in three have disappeared, including those in Sheffield and Birmingham), making layoffs (already there are four thousand) and pulling the 1,300 million cash that he keeps under the mattress. Others estimate that to survive it desperately needs a capital injection of up to two billion to invest in data analysis, technology and improving supply chains. And since the employees, who are the owners, lack large resources, the only option is to sacrifice the model and put up for sale a minority package of shares for that value.
Purists say that would be anathema, and soon the culture of reasonable capitalism that does not need to maximize profits and that of new shareholders eager to get the highest possible return would come into conflict. But among those open to the idea are board chairwoman Sharon White, new chief executive Nisk Kankiwaka and chief financial officer Berangère Michel, who have begun exploring options. The operation would have to be endorsed by two thirds of a council of sixty workers representing all the employees/owners.
In the particular world of John Lewis, loyalty and dedication are the main values and everyone wants to, because for those who sell sheets or electrical appliances, they are not only work but also capital. It is an almost national heritage company, like the BBC or the NHS (public health), nothing to do with Harrods (Qatari-owned) or Zara (part of Amancio Ortega's empire), with a tribal spirit and a culture more its own from the Berlin Philharmonic or FC Barcelona (owned by members) than from a department store. The bonuses are the same percentage of the salary of all quisqui, from the CEO to the last of the 74,000 employees. The day the number is announced, everyone gathers in a room to applaud it, as if it were the lottery.
Well, that was when there were bonuses (in 2008, just before the financial crisis, each employee was given a bonus of 20% of salary), and when people went shopping en masse on the shopping streets of the centers of cities. But this is no longer the case, in the Internet age, and it has been a long time since John Spedan Lewis, in the fifties, proclaimed an injustice that "there are millionaires as long as there are ghettos and pockets of misery." The rich are getting richer, the poor are getting poorer, and your creature is on its way to no longer being the absolute property of the workers.