Andy Street CBE has spent more than 30 years at John Lewis, most recently as Managing Director. He has recently been selected as the Conservative candidate to run as mayor for the West Midlands. We caught up with him earlier this year as he spoke to the region’s leading professionals at our Future Partners event in Birmingham about John Lewis, the Midlands region and private equity.
He shared the journey of John Lewis from a drapers shop on Oxford Street in 1864 to the employee-owned high street giant it is today.
It wasn’t until 2001 that Andy says the business took a step that would catapult it to the status it enjoys today. “In 2001 the dotcom bubble burst, and that’s when we decided to invest in johnlewis.com. We lost tens of millions of pounds in those early years, but fast forward to 2008 and I think that’s where the modern day story of John Lewis really starts.”
During a time of global recession, Andy says the business stuck by its customers. John Lewis refused to compromise on service, product quality or its pricing commitment. Instead it let its profit take the strain and focused on future areas of success.
“That meant aligning around online and particularly multi-channel retailing. Since then, 40% of our business is taken online, and that is far greater than any of our traditional competitors. This country is leading the e-commerce retail revolution, and we are at the cutting edge.”
The business recognised that customers want to be inspired by its stores, but also have access to the convenience and simplicity of online shopping. This approach has seen the make-up of a John Lewis store evolve, and nowhere is this more obvious than in its new Birmingham site.
“We knew the redevelopment of New Street station was the right opportunity, quite simply because it was to be the focal point of the city, and I think we’ve achieved that. By coming here other retailers will come too, sort of like a magnet, and from that magnet redevelopment can stretch out.”
In a time where e-commerce is the driving force of retail growth, John Lewis was ahead of the game. It has become a figurehead for inward investment in Birmingham.
“The future of the Midlands economy is dependent on the big companies yes, but even more importantly on small businesses and those that have not even been founded yet. The strength of the economy comes from diversification, and what’s really positive about what’s happened here in recent years is we’re much less dependent than we were on individual sectors. We’re more resilient, and we know it’s the smaller companies that will grow the fastest.”
Andy believes manufacturing remains critical to the region, whilst the professional services sector will continue to create jobs and there will be considerable growth in the digital industry. “There is much more choice of funding sources for business. Whether it be mutual ownership, a conventional plc or a private sector model, there needs to be diversity. For different companies, different funding solutions will be right, so its fantastic news the private equity market is strengthening here.”