Financials at a glance: Harvey Nichols, John Lewis and Marks & Spencer

Harvey Nichols, John Lewis and Marks & Spencer all reported financials this week – full year for Harvey Nics, while the latter two shared Christmas trading updates.

The results showed that Harvey Nichols and M&S need to desperately rethink their store propositions, while John Lewis ticked along nicely, but what about online trading?

Harvey Nichols

Harvey Nichols shocked the industry with a staggering 30% drop in profits for its financial year ending 28 March 2015, blaming a slow-down in the luxury market. The retailer's Knightsbridge store reported sales falling by 2.4% to £92.5 million, but online trading grew by 27% to £11.1 million.

Harvey Nichols said: "We anticipate that the trading climate for luxury retail will continue to be uncertain and as such retailers need to work even harder to stand out and deliver a strong, differentiated and compelling customer proposition."

As part of that differentiation, the department store retailer is continuing to push forward with its digital investments, which Rupal Karia, managing director of retail and hospitality, UK and Ireland, at Fujitsu, said is showing that the company is taking steps to meet the differing needs of their varied customer base. Harvey Nichols also plans to expand its website reach to other markets, following an eCommerce launch in Hong Kong last autumn.

"Although the retail landscape has never been more digital or mobile, we are seeing a significant demand from customers for a blend of digital and face-to-face services. Recent news has highlighted how a simple factor such as weather can affect sales and as a result stock availability. As such it’s key for logistics and stock availability to also play a role in supporting both of these channels to ensure retailers continue to meet consumer needs," he continued.

"In short, customers want more options when it comes to their shopping experience, giving them the choice to either shop the high-street, online, click and collect and pay through different channels. With this demand for both digital and face-to-face services, retailers need to create a balanced, efficient offering that caters for all customers which is why Harvey Nichols is making a smart move."

John Lewis

John Lewis reported its Christmas trading figures this week, with total sales at the partnership in the six weeks to 2 January up 4.1% to £1,811.1 million: John Lewis sales were up 6.9% to £951.3 million, with like-for-like sales up 5.1%, while Waitrose saw sales increase 1.2% to £859.8 million, but like-for-like sales down 1.4%.

Online told a different story, with both retail arms performing strongly. John Lewis eCommerce sales were up 21.4%, representing 40% of total sales, while Waitrose online sales grew 7.9% with sales during the Christmas and New Year weeks up 9.8%.

John Lewis said: "The combination of our shops, website and fulfilment centres worked together effectively. For example, on the Black Friday weekend our distribution teams processed 18% more parcels than last year, which equated to five units per second during the peak hour. Sales in our shops for the total six week period were down 1.2%, reflecting lower footfall pre-Christmas, but were up 16.2% during the first week of Clearance (week ending 2 January)."

Sophie McCarthy, consultant at Conlumino, added: "Online has played a major part in the retailer’s success this year; as it saw a surge in eCommerce sales whilst its mCommerce platform grew ahead of all other channels. Click & collect orders also rose this year with half of online orders collected in this way. This is a powerful tool for retailers as it means consumers are directed into stores and our research from Conlumino’s 2015 channels and fulfilment report indicates that around half of these will then go on to make an additional purchase instore."

Marks & Spencer

Unlike John Lewis, M&S's food offering remains to be its saving grace, with Christmas sales up 3.7%, but only 0.4% on a like-for-like basis – making it its best Christmas ever. Meanwhile, for the 13 weeks to 2 January, its general merchandise arm suffered with sales dropping 5% (5.8% on a like-for-like basis).

Online sales from M& increased, by what retail analyst Nick Bubb described as a "feeble 20%". The retailer also noted 3.3 million customers joined its loyalty scheme, Sparks, which launched 11 weeks ago.

Steve Mader, vice president of digital retail insights at Kantar Retail, said the online growth was on the conservative end of the scale, considering the difficult time the retailer had after replatforming its website. "I would have expected stronger acceleration coming off weaker base sales, but it's good to see the numbers are increasing."

He said the next logical step for M&S would be to expand its food presence online, as the company only allows customers to order entertainment packs, cakes and wine.

"But before doing too much, M&S needs a solid foundation of its general merchandise and apparel online because adding food would also add massive complexity on the supply chain," explained Mader.

M&S also announced the surprise departure of CEO Marc Bolland, who is retiring in April.