LONDON — Marks & Spencer Group plc has put together a five-point rescue plan for its troubled clothing business, which posted a 2.5 percent sales dip in the fourth quarter ended March 27.
The plan, which the firm set out in a fourth-quarter trading update Wednesday, includes a strengthened management team, improved clothing choice, lower prices, clearer in-store segmentation and inspirational shopping environments.
The company already has slashed the average prices of its spring-summer women’s collections by 3.5 percent. A spokeswoman for M&S declined to comment on further price cuts.
“Sales this quarter are clearly not good enough,” said chief executive Roger Holmes in the statement. “We are taking action on a number of fronts to accelerate the transformation of the business and deliver improved performance.”
Last week, Vittorio Radice took up his new position as executive director of general merchandise, in addition to homeware, and Mark McKeon assumed his role as retail director. In clothing, M&S has strengthened its women’s wear buying team.
Total sales for the group fell 0.1 percent, with the home furnishings division being the worst performer. Sales in that division, which has just been relaunched by Radice, dropped 13.7 percent in the period.
Industry observers were skeptical about the M&S rescue project.
“They’ve talked about improvements before and seem totally unable to sustain them,” said Robert Clark, research director of The Retail Knowledge Bank, a London-based retail market consultancy. “They have a problem across a lot of fronts, and I think it’s going to get worse. They’re going to have to run faster to stand still.”
However, Richard Ratner, a retail analyst at the London-based investment bank Seymour Pierce, remains optimistic. “There have been a number of good senior appointments recently, and hopefully they will help to spur things on,” he said.
— Ellen Burney