STAFF at John Lewis in High Wycombe will have their annual bonus slashed this year despite an overall sales increase across the company's stores nationwide.

But although sales are up, a combination of thinner profit margins, price deflation and investment has meant the company's profits have fallen to £150 million compared with £195 million in 1999 a drop of almost 23 per cent.

Around 800 staff, known as partners, at the Cressex Centre store will receive a 10 per cent bonus, equivalent to about five weeks' pay, compared with 15 per cent paid out in March 2000.

Jill Raven, Managing Director of John Lewis High Wycombe, said she believes that investment is needed if the John Lewis Partnership is to secure a good future.

She said: "Of course we are disappointed, but not surprised, at a fall in profits. Partners know that our bonus could have been higher if we had skimped on the necessary investment, but as a full partnership for staff we're determined to do whatever it takes to make sure that John Lewis High Wycombe is still here and thriving in 50 years' time"

The store received several million pounds for a complete expansion and refurbishment of their restaurant area which was finished late last year and is currently improving security and lighting in the car park.

"We are hoping to completely update both of our trading floors," added Ms Raven.

Greg Williams, a spokesman for John Lewis, is confident that the £350 million invested last year and a further £200 million planned for this year is the way forward.

"The mass renovation of our Peter Jones Store in London alone shaved off £17 million in profits, including one-off costs but we believe that the investment is justified and the direction we are moving in is sound," he said.

"Comparing the difference in sales at our High Wycombe store which was up 5.5 per cent, with our all new refurbished store in Southampton, which was up 25 per cent, is testimony to that."

He said that many costs were one-off, start-up costs that were incurred during renovation and during the acquisition of new stores.

"The way we look at it is as a marathon and not a sprint," added Mr Williams, "But we and our partners can rest assured that what may feel like a short-term pain will actually result in a long-term gain."

Sales were up 5.5 per cent at the High Wycombe store, compared with 25 per cent at the refurbished Southampton store.