More management changes forecast as retailer battles to revive fortunes after slump in general merchandise sales.
Marks & Spencer could face a further shake-up in senior roles at its clothing division, after the retailer announced a major restructure this week during its first quarter trading results.
Tuesday saw confirmation of the long-speculated departure of its executive director of general merchandise Kate Bostock, who will be replaced by M&S lifer John Dixon in October. Dixon, who has been with
the retailer for 26 years, is currently executive director of food.
The management changes are creating a ripple effect through the company. Director of retail Steve Rowe will assume Dixon’s former food role, with general merchandise merchandising director Sacha Berendji taking on the retail directorship in December. M&S is also on the hunt for a head of menswear after it was announced that Richard Price is to join Bhs this autumn.
What will happen to Berendji’s position is yet to be decided, but it is thought Dixon could be planning a significant shake-up of the team in a similar vein to the sweeping changes he introduced to the successful food division after his promotion in 2008.
The appointments announced so far, which also include former Debenhams and Jaeger chief executive Belinda Earl, who takes on the newly created role of style director in September, appear to have met with broad approval from City analysts. “Dixon has done very well in food,” said Clive Black, analyst at Shore Capital. “He has also spent a good deal of time at M&S in general merchandise so I don’t think he is too much of an odd choice for this role.”
Eithne O’Leary, an analyst at Oriel Securities, said it was “unusual to have Belinda in part-time” but it added another dimension to Dixon’s operational focus.
Chief executive Marc Bolland admitted this week that the company had lost market share in some parts of the business as M&S reported its worst trading since 2008, with a 6.8% like-for-like drop in general merchandise sales for the three months to June 30.
But the industry said it could take time for M&S’s fortunes, particularly in womenswear, to be turned around. “It can only really be spring  when we might start to see the impact of these changes,” said Matthew McEachran, analyst at Singer Capital Markets.
Bethany Hocking, analyst at Investec, agreed. “The problem is that any potential effect will not be seen for quite a while,” she added.
One M&S supplier told Drapers M&S needed to overhaul its strategy regarding margins, which was leaving the market open to competitors such as Zara and H&M. “M&S is using coat fabrics that three or four years ago we never would have supplied [because the quality wouldn’t have been high enough]. Now they are using them in their top-range Autograph collection.”
M&S’s new hires
Belinda Earl - Style director
Industry figures have described Belinda Earl as “perfect” for Marks & Spencer with her strong fashion background, although some doubt how much impact she will have working part-time. Previously described as the “Queen of Retail”, Earl will start on a part-time basis on September 1. Her impressive CV boasts former chief executive roles at Debenhams, Jaeger and Aquascutum. A former colleague said: “She’ll be perfect for Marks & Spencer because she’s a real trader; she understands the merchant side of the business and is a great people manager.” However, an analyst cautioned: “Earl did a great job at Debenhams but there is a limit to what you can do when you are only in the business two or three days a week.”
John Dixon - Executive director of general merchandise
A “safe pair of hands” is how one analyst described Kate Bostock’s replacement, but critics have expressed concern about his lack of product knowledge. Dixon, executive director of food, takes up his new role in October. One M&S supplier said: “John Dixon is a lifer at M&S although I don’t expect he knows much about womenswear or product, and it is the product that is wrong and they need to rectify that.” An analyst added: “I do wonder whether John is going to be up to it. How close he will get to the product I don’t know and it is the product that has been going wrong for M&S. But then again, he is a safe pair of hands.” Since joining M&S in 1986, Dixon has worked in roles including director of M&S Direct.
M&S in Numbers
2010 - Year M&S axed womenswear sub-brand Portfolio
6.8% - decline in general merchandise sales in three months to end June
1.25% - Retrospective fee M&S asked its suppliers for in October
8 - Womenswear brands on offer at M&S
£500,000 - How much Marc Bolland received for staying with M&S