Marks & Spencer has announced plans to significantly speed up a major transformation of its UK store estate, a strategic shift heavily influenced by its recent Christmas trading performance.
Festive Performance Drives Strategic Shift
The retail giant reported attracting a record number of shoppers over the crucial Christmas period, driven by a strong leap in festive food sales. However, this success was not mirrored across all divisions. The fashion and homeware arm faced continued pressure, partly due to the lingering effects of a cyber attack in the previous year.
While online sales showed growth, this was counterbalanced by weaker spending in physical stores. M&S partly attributed this to "reduced high street footfall" across the UK, indicating a broader challenge for brick-and-mortar retail. The company stated that the cyber incident is expected to impact its annual profits by approximately £136 million.
Accelerating the Reshaping Plan
Looking forward, M&S is focusing on reshaping the business for growth amidst what it calls an "uncertain consumer environment". Central to this plan is an accelerated transformation of its store portfolio. This strategy involves rebalancing space, with a clear pivot towards food.
Chief Executive Stuart Machin confirmed the move, stating the business would "accelerate the reshaping strategy". This ongoing plan has seen M&S closing and relocating stores that carry clothing lines, while simultaneously increasing the square footage dedicated to its successful food halls and ranges. The goal is to give more space to food offerings, with clothing and home products taking a secondary role in many locations.
Leadership Focus on Future Growth
Stuart Machin reflected on the Christmas period, noting: "A record number of customers shopped M&S this Christmas. From the festive food shop, to picking up party outfits and gifts, millions more trusted M&S to deliver the family Christmas."
He added that the non-food business was "getting back on track as we work through the tail end of recovery," and that overall sales, while slightly down, were seeing improved online performance. Machin emphasised the company's ambition, stating they enter the new year "laser-focused on our plan to reshape M&S for further growth," a plan that will now be executed at a faster pace across hundreds of UK stores.
