Wednesday, October 23, 2019

New M&S Boss faced with writhing fashion climate


Marks & Spencer is expected to report a further sales decline in its fourth quarter results on Thursday.

Along with yearly figures, new Chief Exec Steve Rowe will be encouraged to reveal his turnaround plans for the coming year, specifically in the retailer‘s clothing division.

Following 25 years at M&S, Rowe succeeded CEO Marc Bolland on Saturday. The veteran has headed the company‘s clothing and general merchandise category since last summer and is resultantly expected to have assured plans to improve its underperformance. A detailed overview is likely to be announced in the group‘s full year results in May.

The fashion climate has taken a significant hit in 2016. Just two weeks ago Chief Executive of Next Lord Simon Wolfson noted that this could by the toughest year for UK retail since 2008.

Analysts predict that fashion and homewares like-for-likes at M&S could drop more than 3%, while its food division is expected to have risen by approximately 0.3% in the 13 weeks to 26 March.  

“With the high-risk investment phase of the M&S turnaround complete we expect the new Chief Executive to focus on a low-risk strategy based on better execution and commercial policy” said HSBC analysts.

“We expect greater focus on driving general merchandise top line growth via better product … improved product allocation and replenishment to store and where commercial to do so, margin investment in price.”