DAVIES TO DESIGN FOR MARKS & SPENCER
Byline: James Fallon
LONDON — Marks & Spencer PLC Friday took a major stride toward turning around its ailing women’s wear business with the announcement of a heavyweight new partner and a major new brand.
The U.K.’s largest apparel retailer pulled off a coup by enlisting the help of George Davies, who is considered one of the stars of British fashion retailing. Davies’s previous job was as a consultant to Asda, the British subsidiary of Wal-Mart Stores. Over the course of a decade, Davies developed his George label at Asda into a business with sales of almost $900 million a year in women’s, men’s and children’s wear.
Davies resigned from Asda in November after his contract ended. Prior to that, he built up the fashion chain Next plc, which remains one of Britain’s most successful apparel retailers.
Under the terms of the deal announced Friday, Davies’s company will design, source and market a line of women’s wear and women’s accessories exclusively for Marks & Spencer.
The collection, which has yet to be named, will be a brand distinct from the Marks & Spencer name but will be identified clearly as being exclusive to the store, said Roger Holmes, managing director of the company’s U.K. retail operations.
The collection will launch in late September and will be sold in distinct areas, initially housed in about 100 of Marks & Spencer’s stores throughout the U.K. The areas will average about 2,500 square feet in size, according to Luc Vandevelde, Marks & Spencer’s chairman and chief executive officer. Also, the new brand will represent about 10 percent of the total space Marks & Spencer devotes to women’s wear and accessories, Holmes said.
Marks & Spencer executives declined to reveal sales projections for the new brand because of restrictions imposed by the London Stock Exchange. However, Vandevelde said the goal is for the new departments to generate sales above the retailer’s average sales per square foot. Marks & Spencer’s sales per square foot average about $735, indicating the sales target for the Davies line in 100 stores is above $180 million a year.
Marks & Spencer hopes the new deal will inject a more fashion-forward element to its women’s wear collections, which tend to focus on classic styles. The company has been losing market share in women’s wear to chains such as H&M, Zara, Mango and the discounters Matalan PLC and New Look. The largest declines have come in the 20- to 35-year-old age groups that are now demanding more fashionable designs, Holmes said.
“It is in this more fashionable end where we see the greatest opportunity, while it also allows us in the rest of the business to focus on the more classically conscious customer,” he added.
The agreement with Davies follows the announcement by Marks & Spencer last week of the appointment of Yasmin Yusuf as its creative director, clothing. Yusuf is currently managing director of the fashion retailer Warehouse and is expected to bring a more cutting-edge style to Marks & Spencer’s collections.
The deal also fits in with the launch of Marks & Spencer’s Autograph collection, which featured lines developed by designers such as Betty Jackson, Hussein Chalayan and Katharine Hamnett. The retailer last week said it will begin to feature the designers’ names on the Autograph label as well as the Marks & Spencer brand following demand from consumers to know which designers did which collections.
Autograph, like the new Davies line, is sold in separate departments within Marks & Spencer’s stores. However, the distribution of Autograph is much smaller than the planned distribution of the new brand. In addition, Autograph is sourced and overseen by Marks & Spencer, while the new brand from Davies will be completely owned and overseen by him.
“I will be a supplier just like any other supplier, but with the difference that I will have my own areas within the stores and control over their look,” Davies said.
The agreement was signed Friday morning following about six weeks of talks. Davies said he’d been contacted by almost every major British retailer, as well as many overseas, since leaving Asda in November. He said he decided to link up with Marks & Spencer because he’s always admired the quality of its products, and the deal enables him to be a major force in fashion retailing without operating his own stores.
It also will allow him to experiment with ideas for new supply chain and logistics techniques to speed up the design and delivery of fashion collections, Davies said. One technology he plans to use heavily is business-to-business Internet communication, which will help trim lead times. Davies was unconcerned about the short time he has to develop the first collection for the new brand, saying he wouldn’t start thinking about it for another two months.
“There will definitely be more deliveries per season than with Marks & Spencer’s other collections,” he said. “The only way to get it right for the level of fashion I’m doing is to work with short lead times. You have to be able to react like lightning.”