Blog: Leonie BarrieA penny for your thoughts, Sir Stuart

Leonie Barrie | 15 May 2009

One day after Marks & Spencer kicked off its 125th anniversary celebrations with plans to sell selected products for just 1p, an analyst has warned the retailer its discounting and cost cutting “is threatening the long term health of the business.”

M&S’s “penny bazaar bonanza” will offer 20 products to consumers, including knickers, socks, ties, purses and cufflinks at 300 M&S stores in the UK from next Wednesday (20 May).

“It’s been a tough year for us all but people are fed up with being fed up and we wanted to give our customers a real treat,” said M&S chairman, Sir Stuart Rose.

But it seems analysts at broker Investec are also fed up with the way M&S management is running the firm.

They slam its “discounting to protect market share, and cost-cutting to protect the dividend,” and that rather than trying to compete with the likes of Primark and Tesco it should focus on quality instead.

The analysts also want to see a dividend cut, a focus on the main M&S store format, more out of town stores, a decision on who will be the next chief executive and a halt to overseas expansion.

Quite what Sir Stuart thinks of all this remains to be seen – although he’ll get a chance to air his thoughts when the retailer reveals its full-year results next week. And I’m sure they’ll be worth more than a penny.



Ethiopia unrest a sourcing risk?

Fashion retailer H&M and UK based glove and leather manufacturer Pittards both say they are monitoring the situation in Ethiopia closely after the country's government declared a state of emergency af...


Asia facing up to increased competition

Increasing competition for garment sourcing contracts is seeing China not only being challenged by other countries in Asia, but by sub-Saharan African and even Russian suppliers too. And it is pushing...


Cambodia raises garment worker wages

The monthly minimum wage for workers in Cambodia's textile, garment and footwear sector is set to rise to $153 from January next year, following a vote on the issue last week. The increase marks a ris...


Sportswear initiatives start to take shape

The results of two highly-anticipated initiatives in the sportswear sphere were revealed last week: the launch of Under Armour’s new UAS lifestyle brand and the first pair of running shoes created at ...

just-style homepage

Forgot your password?