Sales plummet at John Lewis as credit crunch takes a stronger grip

The group announced an 8.3 per cent fall in the last week of June compared to the same period last year.

Electrical and home goods led the downturn, with turnover plummeting almost 16 per cent and 13 per cent respectively.

Sales at John Lewis dropped by 8.3 per cent during the week to June 28

The weak performance was shored up slightly by fashion sales, which rose 2 per cent.

There was also evidence that soaring fuel costs were having an impact on trade after John Lewis said its out-of-town stores, such as Bluewater in Kent and Brent Cross in North London, recorded slumps. Bluewater's sales were down 25 per cent and Brent Cross 17 per cent.

Retail analyst Freddy George, from Seymour Pierce, described the John Lewis results as 'very weak', although he said Euro 2008 and Wimbledon might have had an impact.

On the out-of-town decline, he added: 'There must be more going on here than the higher cost of petrol putting off shoppers.

'Perhaps they are progressively being viewed as not attractive places to visit during the summer.'

Customers may also have stayed away in the run-up to John Lewis' summer sale, which started on June 29.

Electrical and home technology sales were down 15.8 per cent during the week, with home items 13 per cent worse off. Fashion helped stem the decline with a two per cent rise, John Lewis said.

Sales of bigger ticket items such as washing machines and sofas have been among the main casualties during a consumer spending squeeze.

Just two of the chain's branches posted sales rises - the flagship branch on London's Oxford Street, which enjoyed an overall 5.6 per cent rise, and Knight & Lee in Southsea, Portsmouth, which was 0.7 per cent better off.

The group has previously said the capital's performance has been boosted by tourism revenues.

New stores in Liverpool and Cambridge were also trading well, John Lewis said, with graduation season driving outstanding sales of hats and accessories at the latter location.

The group's Scottish stores managed to clung on to single-digit percentage sales falls during the week.

But others registered bigger declines. Sheffield was down 12.6 per cent, Solihull 20.6 per cent worse off and High Wycombe 17.7 per cent down.

Waitrose sales were three per cent up during the week compared to last year, down from 5.2 per cent the week before. Overall John Lewis Partnership sales were down 1.2 per cent during the week to June 28.