What: An analysis looks at what’s changed between the two British department stores and where the two retailers have gone right and wrong.

Why it is important: The roles between John Lewis and M&S have reversed as M&S reports higher sales and profits, while JLP reports widening losses.

The department store model has morphed, as retailers move their focus from mono-brand businesses to offering multiple brands that they own, license, or stock on a wholesale basis, Marks & Spencer’s model has an advantage over John Lewis as they have a broader category spread.

John Lewis was an early mover in e-commerce, but as a store-based business, its success online meant physical stores generated less revenue. With this higher percentage of online sales, JLP sees more returns and higher fulfilment costs, while M&S is still enjoying online growth, as online only accounts for a third of sales.

Both department stores have been closing stores, with M&S being more radical and opening new branches. M&S is better positioned to take advantage of the recovery of physical shopping as they open key locations and have a network of 1,487 stores in comparison to JLP’s 34.

John Lewis doesn’t seem to be heavily affected by the cost-of-living crisis, as it launched its Anyday budget line and reports customers shopping across price ranges.  However, grocery plays a bigger role in its overall business and in an inflationary environment, customers are more likely to shop at discount grocers like Aldi and Lidl. M&S reported that its customers are resilient and able to keep spending.

JLP has seen more changes in management recently, with the appointment of a new CEO who comes from a background in food and is known for tough decision making. Marks & Spencer has seen management movements over the past several decades as well, but its big changes have been driven by insiders.

While John Lewis Partnership appears to be struggling, it still remains a key player as a retailer with its total sales reaching GBP 12.25 billion last year, with John Lewis sales reaching GBP 4.94 billion.

Analysis: as John Lewis mulls ownership tweak, why is it lagging rival M&S?