In the money: M&S expects clothing improvement in autumn
M&S says it is working hard to improve its clothing offer
Marks & Spencer chief executive Marc Bolland today (11 April) highlighted the efforts already being made by the retailer's new clothing design team - but stressed the full results of their efforts won't be seen until the autumn/winter range is released.
He said the new general merchandise team, headed by John Dixon, made some minor changes to the last autumn/winter collection - and that while they didn't design or buy the collection, they edited it, cancelling some items, and buying more deeply in others.
These moves led to 4% less waste over the fourth quarter, Bolland said.
His comments came as the retailer said UK general merchandise sales fell 3.8% on a like-for-like basis over the fourth quarter ended 30 March. General merchandise sales fell 2.2% on an overall basis.
"We have always said this quarter was a challenging one," said Bolland.
"We have very good trends out there, however, we need to further improve. And what we've said consistently is we can do better than this, we're working hard at it, we're working hard at improving it.
"So we'll see the team's first collections come out in autumn/winter, and we have confidence that it and the next season's will be an improved line."
Bolland also said the company faced pressures from a highly promotional market in March.
"On the promotional side, we've held our price stance as much as we could, but in late March the pressure was strong," he said, adding that a number of retailers were holding 25% off promotions.
"We had to respond. But we had a much more targeted approach," he added. "We protected our gross margin, we didn't do any megadays, but were strongly targeting our promotions over the month, and that was in response to the market, we were not leading the market."
The retailer also said it was "cautious" in its outlook for the full year, expecting pressure on consumers' disposable incomes to continue.
When asked whether he expects the promotional environment to continue on the back of the unseasonably cold weather in the UK, Bolland said: "I believe the sun will be shining on Sunday, so let's get a bit more optimistic."
Potential to do better
However that optimism was not shared by some industry watchers, with Conlumino analyst Neil Saunders saying it is "almost impossible that M&S will ever go back to the pre-1998 heydays when its clothing market share was at its zenith".
He believes the market has changed too fundamentally since that time, with the more fragmented landscape making it almost impossible for a player of M&S' configuration to take the share it once did.
"However, that does not mean to say that M&S's market share could not be bigger and it certainly does not mean that M&S should accept recent declines in share as being inevitable. It has the potential to do much better; whether it has the will is another matter," emphasised Saunders.
He argues the retailer's fundamental problem is that it still thinks and behaves like a middle market clothing retailer of yesteryear.
"Many attempts have been made to shift this attitude and it would be unfair not to recognise that some progress has been made," Saunders said.
"However, old habits die hard and M&S's middle market DNA still shows through in so many ways. Sub-branding is not executed with anywhere near enough sensitivity and the personality of the various brands is indistinct and poorly targeted.
"Stock density is far too high in store, which creates a sense of product ubiquity and makes the shopping experience less pleasurable. Visual merchandising is often mediocre and even in newer stores there is a distinct lack of excitement and of taking the customer on a journey through the offer.
"In short, change on clothing has been nowhere near radical enough and the pace has been too slow."
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