Cash is king for Lewis as it repositions
Retailer's results show healthy move away from credit reliance
The shift from credit sales to cash is continuing in furniture retail, Lewis's latest results show. A decade ago, Lewis was a minnow in a big pond in which JD Group and Ellerines Holdings were the big fish. The fundamentals for furniture and appliance sales were looking good. Economic growth and access to credit were fuelling strong demand for anything from beds and lounge suites to flat-screen television sets, the latter being still a relatively recent phenomenon. But credit-fuelled consumption spending could not be sustained, mostly due to lower growth and weaker sentiment - a trend that continued long after 2008's global financial crisis was over. In the boom years of the early 2000s, furniture retailers had become so accustomed to healthy growth that they tried to sustain it in the lean years through unhealthy methods. Soon they had become too dependent on the revenue from the financial services they had sold along with the credit.Lewis has used the past five years to become mor...
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