Next unveils huge development in £2.5bn economy boost
Retail giant Next has unveiled a huge new development which it says will add £2.5bn to the economy, as the FTSE 100 firm invests over £300m in its warehouses.
The firm has been granted planning permission to build a new 1.2m sq ft warehouse in its Elmsall complex in Yorkshire, with construction set to commence in 2028 with the site set to be in full operation from the beginning of the next decade.
Next’s share price jumped as much as six per cent on Thursday as the retailer notched a 15 per cent jump in profit, to £1.2bn before tax in the year to January 2026.
The retailer is spending big on its warehouses as it looks to push UK growth, which was far lower (seven per cent) than its sales growth internationally (35 per cent) in the last year.
The company will spend £307m on logistics in the next three years, as online demand outstrips Next’s expectations – with web sales growing 28 per cent over the last two years compared to the 10 per cent forecast.
As the retailer rolls out new infrastructure in the UK it is also investing in AI in its contact centres, product teams and software development.
Next: AI will not replace existing staff
Chief executive Simon Wolfson said existing staff need not fear losing their jobs to AI, though the firm is hiring at a slower rate due to its use of tech.
The company’s financial report said: “We are not developing a central AI function. […] AI will change people’s jobs rather than replace them, making them much more effective, and taking away many of the tasks they enjoy least.”
The firm said it does not yet use AI in its warehouse operations, but said the technology is “perfectly” for future use in forecasting demand for stock.
Chief executive Simon Wolfson said: “AI is perfectly placed to help support those decisions because in essence that is gathering a huge amount of data, making forecasts, scenario analyses, and then optimizing between them.
“And that is something that actually human beings with experience probably start better at, but I think AI can help with that.”
Next’s expansion of its UK sales capacity comes as retailers brace for potential energy and manufacturing cost hikes due to the Iran war.
Asked if his firm would join other retailers in calling for energy bailouts from the government, Wolfson said he does not think Labour should offer emergency help to companies at consumers’ expense.
He said: “We’ve got to recognise one of the fundamental realities is that the government hasn’t got a lot of money spare. So I think asking for money is problematic at a time like this.”