LONDON — Marks & Spencer plc is losing some of its share of the U.K. women’s wear market — and it’s planning to fight back.
The company, which on Tuesday released results for the year ended April 3, said its share of the clothing market declined 0.2 percentage points to 11 percent during the period. Clothing sales rose 1.4 percent to 4.03 billion pounds, or $6.85 billion, from 3.98 billion pounds, or $6.77 billion, in the 53-week fiscal year. Dollar figures have been converted at the average exchange rate.
“The initial surge in the recovery of our clothing and food businesses faltered,” said Roger Holmes, chief executive of M&S, in a statement. “Our clothing share declined, reflecting underperformance in women’s wear, particularly knitwear, and children’s wear.”
In a bid to build up market share, M&S said it plans to relaunch and expand its Limited Collection line of women’s wear and accessories.
The new Limited Collection will be launched in 66 stores in the U.K. and Ireland on Sept. 1, and will be sold in 70 stores by March. It will be sold overseas in 36 franchise stores in 17 countries as well.
Limited Collection has been retooled to appeal to women ages 35 to 44 and will offer casual tailored pieces, knitwear, outerwear and accessories. M&S said it will freshen the collection every three to eight weeks, keeping up with key seasonal trends. The line will also be clearly defined within the store with its own shop fit.
“Limited Collection is an important step in our strategy of segmenting women’s wear, a strategy which Vittorio [Radice], and his team are committed to driving forward,” said Holmes in the statement. Radice is the new head of general merchandise at M&S, and head of M&S home.
Meanwhile, profits at Marks & Spencer plc rose 8.9 percent to 552.3 million pounds, or $938.9 million, from 506.9 million pounds, or $861.7 million, in the year. Turnover rose 3.5 percent to 8.3 billion pounds, or $14.1 billion, from 8.02 billion pounds, or $13.6 billion.
At the home furnishings division, sales fell 2.9 percent to 526.6 million pounds, or $895.2 million, from 542.6 million pounds, or $922.4 million. M&S has revamped and modernized its home-goods offering, and the firm opened its first Lifestore in Gateshead in February.
“Customers responded well to the Lifestore environment and were excited by the concept, but the product in some areas has been too contemporary, and sales were down on last year,” he said. Holmes added that a second store in Kingston would open in the summer and would implement lessons learned on environment, product appeal and price.
Luc Vandevelde, the chairman of M&S, who will step down later this year, said the store’s performance in the year was solid — but disappointing.
“We are not satisfied with our sales progress,” he said in the statement. “The market share gains that we had hoped to achieve were not delivered. However, we did increase our share in men’s wear, lingerie, Per Una and women’s casual wear, and held our share in food,” he added.
Industry observers say that M&S has a long road ahead revamping its women’s wear collections.
“They’re touching around the edges with the relaunch of Limited Collection. They need to change the core women’s wear ranges, and that’s not going to happen until Kate Bostock gets there,” said Richard Ratner, a retail analyst at Seymour Pierce.
M&S has named Bostock, who is currently product director of Asda’s lucrative George clothing and accessories brand, director of women’s wear. She will start work in September, although an M&S spokeswoman said the store was already in talks with Asda to get her earlier.
Edward Whitefield, chairman of Management Horizons Europe, a retail consultancy here, put M&S’ situation more bluntly. “The iceberg has hit the Titanic, and they have finally begun to plug the gaps,” he said. “They needed to hire Vittorio Radice and Kate Bostock three years ago to solve these problems.”
— Samantha Conti