A bullish Steve Rowe today defended the “difficult decision” to cut a number of UK and international Marks & Spencer stores, saying it was necessary if he is to rebuild the retailer as a modern business.
In the UK, 30 full-line stores will close and 45 will be downsized or turned into branches of M&S Simply Food, leading to a net reduction of 10% of clothing and home space.
Internationally, the retailer is planning to close 53 of its company-owned stores and exit 10 “unsustainable” loss-making markets.
Rowe, who took over from Marc Bolland as chief executive of M&S in April, said the steps were needed to “lay robust foundations for future growth”.
He added: “It requires tough decisions but they are vital to building a simpler, more relevant M&S. Our UK store estate needs to represent how consumers are shopping in a multichannel environment. We need a more agile approach to our store estate.”
The M&S “lifer” said the clothing and home business would benefit from “larger, more inspirational” stores that would complement its “strong multichannel business”.
Rowe said the firm’s ailing fashion business had seen some “early shoots of improvement” in the second quarter, when its full-price value share was up by over 30 basis points - the first time in five years the retailer has gained full-price market share.
“Quality underpins what our shopper wants and expects from M&S clothing,” said Rowe. “We need to be a cut above the rest in terms of fabric, fit and finish. Complementary to this is creating wearable styles and having authority with the ranges we present.”
For autumn the retailer focused on buying deep into key styles and reviewed its fits. M&S has simplified its offer and now has 10% fewer clothing lines and 20% less in womenswear.
Taking this a step further for spring 17, the business is dropping its Indigo, Collezione and North Coast sub-brands and will concentrate on the brands that are “most relevant” to its customers, such as Autograph, Per Una and Blue Harbour.
“It is early days but our customers are noticing the differences to product and the overall in-store experience,” affirmed Rowe.
Rowe said he would avoid increasing prices where possible, as the cost of the devaluation of the pound would be largely mitigated by the retailer’s sourcing, which is focusing on “better buying” and has 70% of all designs sourced directly from factories.
As reported earlier this week by Drapers M&S is pulling away from more of its third-party suppliers in a bid to streamline its processes and cut costs.