Strategy

• Expanding partnership with Gail’s bakery
• Opening new stores for first time in six years from 2024 
• ‘Digital-first’ approach as part of Partnership Plan  
• Investment in own-brand food, streamlining offer, and food innovation   
• Upscaling ecommerce arm and increasing delivery capacity  
• Right-sizing its store estate and embarking on refurbishment programme  
• Growing convenience business and commercial partnerships  
• Supporting consumers through price investments while maintaining quality and ethics  

Like the other major grocers, Waitrose has been battling intense competition, changing shopper habits and rising costs. Widely considered the most upmarket mainstream grocer in the UK, with the possible exception of M&S, Waitrose is intent on delivering “more of what makes Waitrose, Waitrose”, simplifying the way its shops are run, and spending “less time on process, more time with customers”.  

Expanding from 2024 

Waitrose returned to growth in FY2023, with net sales rising 5.8% to £7,139m for the 52 weeks to 27 January 2023 despite volumes falling 1.5% on the previous year with average item prices rising 6.6% at the retailer due to soaring inflation.  

The grocer is set to kick-start “record” investment, announcing plans to open its first new stores in six years, targeting areas where the brand is “underserved.” Investment will also see Waitrose refurbish 80 stores over the next three years. 

Waitrose executive director James Bailey said new partnerships with Uber Eats and Dobbies had bolstered sales in the latest year. Its £5 meal deal, which launched in August 2023, has proved popular, now averaging 200,000 customers a week.  

During FY2023, Waitrose said a “record number chose to shop with us” with customer numbers climbing 8.1% to 15 million. 

It announced plans to open upto 100 convenience stores over the next five years as part of a £1bn investment in August 2024. 

The grocer opened its newly refurbished John Barnes store on London’s Finchley Road the same month, which trials new product offerings and service counters, becoming part of a “new blueprint” for Waitrose shops to be revealed in 2025.

Investment includes:

• Upgrading service counters - meat and fish counters given a new look and upgraded.
• Award-winning wine selection given greater prominence - its refurbished  Finchley Road store is the first Waitrose to feature an entirely chilled department for white wine, champagne, rosé and beer.
• Greater flexibility to respond to local demand - Finchley Road has given more space to top sellers including adding a second dry aged beef cabinet and dedicated parmesan section - 12% of Waitrose parmigiano counter sales come from the one store.
• More third party collaboration - a new and exclusive partnership with Crosstown Doughnuts has been introduced as part of a refreshed bakery offer, it has also expanded its concession with Sushi Daily to include a ‘Hot Wok’ offer of ready-to-eat dishes.
• More dedicated space for on demand grocery orders - Finchley Road is the first Waitrose shop to feature a hatch to allow riders to make collections outside of the store’s opening hours. 

Priorities under Partnership Plan 

Waitrose is operating under the Partnership’s Partnership Plan, which has entered its fourth year. For more, see the JLP profile.  

Priorities at Waitrose include:  

• Making shopping easier and more convenient – improving delivery and collection  
• Investing in availability online and in store  
• Keeping prices down for consumers without diluting quality and ethics  
• Investing in own-brand food, streamlining offer, and innovating on food  
• Enhancing useability and personalisation of websites and apps   
• Offering better loyalty rewards  

Waitrose unveiled a £30m investment in prices in mid-February 2024. 

The retailer said the “investment comes across British meat, fruit and vegetables, store cupboard staples and products sold on our popular fresh food counters, with more price cuts to follow this spring”. 

Gail’s bakery expansion

Waitrose is furthering its partnership with Gail’s bakery, set to launch an in-store takeaway service in its Canary Wharf store in June 2024. 

The supermarket already has Gail’s sections in 64 of its stores, with the retailer telling The Times that its Canary Wharf store makes up nearly 5% of Gail’s sales in its stores. Customers in its Canary Wharf store will be able to purchase Gail’s food and drink to take away, as well as order using Gail’s click and collect services. 

Waitrose customer director Nathan Ansell said: “Building on our successful partnership with the launch of a new and innovative Gail’s bakery is hugely exciting. Synonymous with quality, expertise, and taste, Gail’s very much reflects our own core values, and we know how much our food loving customers enjoy their products.” 

Supporting consumers through price investments  

Waitrose was arguably late in joining its fellow grocers in lowering prices for consumers amid the cost-of-living crisis. But, following a £100m price investment via the MyWaitrose reward scheme in early 2023, it went on to implement two other major price-cut initiatives on key products during the year.  

Its value credentials have also been supported by its Essentials range and Brand Price Match initiative. It also introduced a lunchtime meal deal for the first time ever in mid 2023, comprising a main, side and drink for £5.  

MyWaitrose members, of which there were nine million as of end-January 2023, also welcomed the return of free coffee in late 2022 as the grocer attempted to bolster sales.  

Cost-saving efforts  

Having committed to being “lean, simple, fast” under its Partnership Plan, the group is operating as a “lower cost, far simpler business that creates more pace and freedom for Partners and more cash for growth”. The business is targeting £900m of cost savings by 2027.  

As part of its cost cutting, Waitrose demanded more flexibility from employees, explaining in mid 2023 that for each full-time equivalent employee it makes a loss of £400 every year. A consultation was launched under a project named ’Simpler Shops’ to bring in changes to contracts, with employees reportedly at risk of losing their jobs if they failed to agree to more flexible hours. Waitrose was also reportedly intending to end the night shift in 18 shops.  

Efforts to reduce costs through creating efficiencies across the Partnership from 2019 have also includes Waitrose collecting John Lewis click-and-collect returns at the same time as delivering groceries.  

Previous right-sizing of store estate   

Waitrose had been “right-sizing” its store estate, which included “rebalances” of store space, as well as store openings and closures. Meanwhile, as the final step in a turnaround programme executed in partnership with US consultants Bain from mid-2022, a plan was revealed in 2023 to invest £250m in revamping 332 UK stores in a bid to win back shoppers.  

Recent store overhauls have included rebranding stores under the Waitrose & Partners banner to emphasise how its ownership structure and unrivalled focus on product and service set it apart from other grocery retailers.  

As it continues to build on in-store services, features such as its concierge-style welcome desks, display units, seasonal bays, perch tables and gardening pods all contribute to its efforts to provide customers with enticing reasons to visit branches, providing offers and services not available online.  

Also, making the most of its Partnership set up, more shared locations between John Lewis and Waitrose can also be expected going forward.  

Uncompromising on standards   

Despite JLP negotiating with suppliers on the cost of goods sold as part of its cost-saving efforts, the business has been careful to protect product quality, its close relationship with suppliers and its sourcing ethics, all of which are features that help differentiate Waitrose from rival grocers.   

Waitrose has traditionally sourced a larger proportion of its offer from the UK than the sector average and, known for its caring credentials, continues to support the farmers it works with and in FY2022.  

Its Food to Feel Good About integrated marketing campaign, launched in late 2022, feeds into these strengths, shining a light on “quality, taste, ethics and vale, to celebrate food that makes a positive difference”.   

Ongoing product innovation  

Armed with a plethora of own-brand ranges from the more affordable Essential range to the premium No. 1 and Waitrose Duchy Organic offer, Waitrose continues to innovate on food.   

Although work to improve the efficiency of stores has seen Waitrose reduce the range of items stocked on shelves to limit duplication and bolster sales, product innovation remains high up its agenda, with 779 new products launched in FY2022.  

Waitrose has also been using AI to innovate around food. In 2023, it deployed Tastewise tools as well as TasteGPT to curate recipes and menus and in mid 2023, used AI to complement its own data to develop its own-brand Japanese-inspired food range Japan Menyū.  

It acquired meal-kit delivery service Dishpatch in June 2024, which delivers pre-prepared meals with recipes from the likes of chefs such as chefs Angela Hartnett, Michel Roux Jr and Rick Stein.

Bailey commented: “While our immediate focus will be helping Dishpatch grow its core meal-kit business, we are also looking forward to working with the team to bring further new and exciting food experiences to Waitrose customers.”

Relaunches No.1 food range 

Waitrose relaunched its No. 1 food range in mid-June 2024 as it seeks to re-invigorate its offer. No.1 has over 600 products in its range, with nearly 200 new and improved, which the upmarket grocer says make it “the ultimate go-to for food lovers”.  

It plans to introduce more than 130 new products to the range, including new ready meals, dips, pasta & sauces, coffee, desserts, bakery treats, plus meat and fish which uphold its staunch animal welfare standards. 

Products have been updated with new packaging “to ensure a premium feel for all the range and to reflect the high quality of the products inside”.  

The relaunch of Waitrose No. 1 follows several own brand launches, branded exclusives and partnerships at the grocer in 2024. These include its Ottolenghi range, collaboration with Tony’s Chocolonely, and the first in-store bakery from Gail’s. 

Growing convenience and commercial partnerships   

Building on its convenience offer and plans to accelerate growth through partnerships, Waitrose had “pushed into” 122 convenience stores by May 2023, through partnerships with the likes of Shell, as well as a presence in Dobbies Garden Centres.  

Furthermore, orders via speedy delivery company Deliveroo (through which Waitrose has also trialled the 10-minute Hop service) were up 33% year on year for FY2023, with its rapid delivery proposition set to grow further through a more recently introduced tie up with Uber Eats, both of which should draw in a new, younger customer base.    

The retailer added Uber Eats to its list of rapid delivery partners in October 2024 with Bailey commenting: “As demand for greater convenience has grown, so have expectations of convenience food – and rightfully so. Neither show signs of slowing and that is a huge opportunity for us.”

Upscaling ecommerce arm   

As part of its Partnership Plan, JLP’s digital-first approach envisages more than 20% of Waitrose sales coming from online, up from 5% pre-pandemic.  

Waitrose has developed its online offer at pace after its long-running supply partnership with Ocado was taken over by Marks & Spencer when the agreement came to an end in September 2020.  

This has included building capacity. In addition to regional distribution centres in Bracknell, Aylesford and Leyland, Waitrose opened its first national distribution centre at Magna Park in Milton Keynes in 2015. More recently, in preparation for the Ocado split, it scaled up its ecommerce arm “utilising existing expertise across the Partnership” and building online capacity by increasing the number of stores fulfilling online deliveries and opening additional fulfilment centres.  

Most Waitrose online deliveries are picked from shops but extra demand in London is served by three online fulfilment centres – one in Enfield, North London, another in Greenford, West London and the third in Coulsdon, South London.  

And Waitrose became the first UK supermarket to trial a new generation of electric vehicles from early 2022, with groceries from the St Katharine’s Dock, London, store delivered to consumers entirely via electric vans equipped with wireless charging technology. The grocer is set on ending its use of fossil fuels across its entire transport fleet by 2030.   

In another move that differentiates Waitrose from its online grocery competitors, and as part of plans to increase its focus on food service counters, Waitrose launched its food service counters online in 2021. Emphasising Waitrose’s ability to engage shoppers in niche areas, Waitrose has introduced specialist websites – including Waitrose Cellar, Waitrose Garden and Waitrose Florist – bringing the expertise offered in-store to online shoppers.  

Click-and-collect key to fulfilment 

Click-and-collect is key to Waitrose’s fulfilment offer having been rolled out in-store and to third-party locations, including at Tube stations in London.  

Additionally, automated temperature-controlled lockers have been installed at various transport locations, including car parks at Gatwick. Customers can place orders via the website or smartphone app.  

A couple of years ago the retailer also implemented auto check-in technology across Waitrose stores for John Lewis click-and-collect orders. Orders are prepared once a customer walks into a store.  

Boden, Sweaty Betty and Nespresso customers can also use the John Lewis click-and-collect service to pick up their orders from certain Waitrose stores.  

Technology implementation to enhance offer   

In recent years, Waitrose has contended with IT challenges caused by the legacy infrastructure across JLP. IT update problems have caused periods of stock shortages on shelves. IT issues were further exacerbated by the fire at Waitrose’s Brinklow distribution centre in 2022.   

The retailer is in the midst of an IT transformation, which as of late 2023, could reportedly still take up to another three to five years to complete. JLP announced new partnerships in April 2023 with customer loyalty and marketing experts Dunnhumby and Eagle Eye, which could bolster its personalisation abilities before the launch of a combined John Lewis and Waitrose loyalty scheme, which is in the pipeline, and its continued partnership with Google to migrate more of its technology to Google Cloud in mid 2023. JLP is also working with Snowflake on unifying legacy systems across the partnership and utilising data insights. As the group develops common technology platforms it is also working with Wipro and Capgemini. For more on these partnerships, see the JLP profile.  

As it looks to further improve its stock availability, Waitrose is set to trial a new inventory management system - Trust Retail Inventory Management solution - developed by Trust Retail.  

The software will be implemented initially in a small number of stores during 2024, with a full rollout planned for 2025. The retailer says the new system should give partners real-time stock visibility.  

Over the years Waitrose has used advanced technologies to help it stand out and enhance consumer experience, with branch managers using tablets in store with apps to support leadership tasks, freeing up time to focus on customer services and team guidance.   

Additionally, customers can use either a Waitrose handset or their smartphone for the ‘scan as you shop’ Quick Check service, allowing shoppers to scan items as they shop without having to unpack their bags before paying.   

Other technological introductions and partnerships include:  

• A deal with Netcore Unbxd from late 2023 to use AI on Waitrose’s website to improve its personalised online search capabilities and user experience 
• Partnership with CitrusAd from late 2023, which allows Waitrose to run targeted advertising across its website for the first time  
• Renewed its contract with EPoS provider PCMS for 10 more years from 2016, with PCMS’ Vision OnDemand mobile point of sale facilitating mobile payments.  

International channels  

Waitrose has exported own-label products on a wholesale basis to premium retailers since the late 1990s, in countries ranging from Japan and the Philippines to, more recently, India and China.  

It also has 10 or so franchise stores in the Middle East operated by Fine Fare Food and in late 2020, unveiled its first dedicated website for overseas shoppers in the United Arab Emirates, which is also run with its local partner.   

The grocer also sells a limited range of products available on Alibaba’s Tmall website in China and supplies the catering on board Eurostar trains.   

Export business expansion  

Waitrose announced plans to “rapidly” expand its export business, from December 2023, shipping to more countries and offering a “greater range” of products. The retailer said export sales are up 14% on last year, setting a growth target of at least 10% for next year.    

Global demand for its own brand products has grown by 92% in the last decade as it continues to expand into new territories. The Waitrose brand can be found in 42 territories, including Malaysia, Chile, Jordan, Singapore, Vietnam, Thailand and nine Caribbean islands.  

It has showcased its food and drink to a global range of large supermarkets and distributors, including those from Asia, Africa, the Caribbean and Europe as it seeks expansion.