One of Marks and Spencer’s largest shareholders has asked the 132-year-old retailer to release some of its loss-making stores. The suggestion follows comments from a senior source who noted that the chain’s large store estate is one of the biggest “headaches” for senior management, according to The Telegraph.
While the new boss Steve Rowe prepares to unveil his plans for the business, radical ideas including store closures and a shedding of the British retailer’s vast portfolio as well as the introduction of concessions are being analysed and debated.
“The store portfolio is an area where we would expect Steve Rowe and Helen Weir [the finance chief] have been spending a significant amount of their time”, said M&S’s sixth-largest shareholder Columbia Threadneedle.
“Space re-allocation and potential disposals will likely be discussed on May 25.”
Those close to the situation have said that Rowe is likely to centre his update on his plans for the group’s general merchandise unit after he announced that M&S’s struggling womenswear department was his “number one priority”.
Having already slashed its spring line clothing costs by around 15%, Rowe is expected to cut clothing prices further in order to keep up with fast-fashion competitors such as Inditex owned Zara and appeal to younger customers.
“The company has been in denial about who its core customer is, but Steve Rowe might just get it,” said Richard Hyman, a retail Analyst.
“He is an M&S man, a trader, a retailer – and Marc Bolland wasn’t any of them,” Hyman added.
M&S is expected to announce a 2% rise in pre-tax profits to £673m on 25 May.