The consensus for LFL sales was a 3.5% decline. While improving sales of its more expensive Autograph clothing ranges, its strategy of reducing the number of items on promotion was dealt a blow in the third quarter by having too much stock.
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But despite an unsatisfactory performance in clothing, some of M&S’s countermeasures are beginning to bear fruit, particularly online where returns were down 7 to 10 per cent in the quarter, which Rowe credited to a better focus on finish and fit following the recent appointment of womenswear director Jo Jenkins.
Despite celebrity collaborations, including lingerie designed by model Rosie Huntington-Whiteley, pictured, clothing sales have risen in only one quarter over the past five years.
Rowe, who took over from Marc Bolland last weekend, has made his “number one priority” a revival of the general merchandise business he has run since last July.
M&S describe the Clothing and Home market as challenging, characterised by price deflation and flat demand.
M&S’s latest move to revive women’s clothing sales came in February when it sealed a tie-up with TV presenter Alexa Chung to launch a fashion collection inspired by the company’s extensive range.
“We have a good feeling about Rowe; he has spent time in stores, has delivered food success and has started his first week in the best possible place, in stores with colleagues and customers”, comments James McGregor, a partner at Retail Remedy Consultants.
Analysts provided mixed reaction to the trading update from High Street bellwether Marks & Spencer Group PLC (LON:MKS) today, which showed the food business performing well but weighed down by clothing.
Laith Khalaf, senior analyst at Hargreaves Lansdown, said: “Clothing continues to be a rather large millstone around Marks and Spencer’s neck”.
Rowe defended the company results by saying that the decline was “less steep” than city analysts had been forecasting. Its food business posted flat like-for-like sales growth for the quarter, while total sales rose by 4% and the retailer’s share of the grocery market grew to 4.3%.
The retailer’s food business increased its presence across the United Kingdom by opening 80 new stores. Our food business once again outperformed the market by 3.5 per cent.
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He is expected to shed light on his turnaround plan when the company announces its full-year results in May.
