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.

 


BLOG

Regional supply chains shape up

Regional patterns in world textile and apparel trade are becoming increasingly important, according to an analysis using data from the re:source by just-style sourcing tool. The trend reflects both th...

BLOG

US-China trade spat spurs sourcing shifts

The coming change of control of the House of Representatives following the US mid-term elections will probably do little to stop the escalating tariff disputes between the US and China, the American f...

BLOG

Apparel makers - Let's get virtual

The Virtual Reality market is becoming a bit of a big deal. According to recent forecasts from DigiCapital, the global VR market value could surpass $120bn by 2020. And, as consumers are demanding mor...

BLOG

Complexities of multi-channel pricing, sourcing and stock control

The fashion industry is operating in a multi-channel world – but when it comes to managing this approach, it seems there is no unanimity of best practice (and often no best practice at all) on multi-c...

just-style homepage



Forgot your password?