LONDON — British retailer Marks & Spencer is expected to cut an estimated 525 head office jobs, according to the company on Monday.
Fifteen percent of the positions in London’s Paddington office will be shed in an effort to “reshape and redefine the organization,” M&S stated.
The company reported that the decision is a part of its strategy “to work more simply and more efficiently.” The downsizing will be implemented through the use of “fewer contractors, natural attrition and redundancies for M&S employees,” M&S said, adding that shop employees won’t be affected.
Earlier this year, Rowe took over from Marc Bolland as head of the retail giant as its sales in clothing and home continued to erode in the fourth quarter. The company reported the sharpest like-for-like decline in its clothing business for more than a decade, with sales down 8.9 percent in the 13 weeks to July 2.
“M&S has to become a simpler and more effective organization if we are to deliver our plans to recover and grow our business,” stated chief executive officer Steve Rowe. “It is never easy to propose changes that impact on our people, but I believe that the proposals outlined today are absolutely necessary and will help us build a different type of M&S — one that can take bolder, pacier decisions, be more profitable and ultimately better serve our customers.”
“We remain committed to investing in store staffing and improving our customer experience and therefore our store colleagues are not affected by this proposal,” added Rowe.
The high-street chain reported on Friday that it promised a 14.7 percent increase in wages for shop floor staff to 8.50 pounds, or $11.33 at current exchange, per hour and 9.65 pounds, or $12.86, in London.
Earlier this year, M&S joined the see-now-buy-now movement by launching The Big Easy, a capsule collection. It features 24 trans-seasonal pieces that are designed to be layered.
M&S has also been grappling with the wider problem of struggling general merchandise and clothing sales. Its clothing division has fallen victim to a number of other factors, too, including price deflation and a flat market. Rowe said part of his plan was to “sharpen” prices on a number of lines and deliver a strong gross margin improvement.