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Marks & Spencer to close 100-plus stores by 2022 in ‘radical’ plan Marks & Spencer to close 100-plus stores by 2022 in ‘radical’ plan
(about 5 hours later)
Marks & Spencer is closing one in three of its core clothing and home branches in a dramatic retreat from the UK high street that will trigger thousands of job losses.Marks & Spencer is closing one in three of its core clothing and home branches in a dramatic retreat from the UK high street that will trigger thousands of job losses.
M&S on Tuesday revealed the locations of the latest 14 stores to shut, affecting more than 600 jobs. It said the closures were vital for the future of the struggling retail business but Usdaw, the shopworkers’ union, accused M&S of “salami slicing”, as staff came to terms with a third wave of store closures. M&S on Tuesday revealed plans to close a total of 100 shops by 2022, as it expanded an existing store closure programme. It said the closures were vital for the future of the struggling retail business but Usdaw, the shopworkers’ union, accused M&S of “salami slicing”, as staff came to terms with a third wave of store closures.
The retailer has already closed 22 clothing stores, affecting about 900 jobs, as part of a “radical transformation” plan intended to tackle years of falling sales and profits. The cull is part of a plan announced 18 months ago by the chief executive, Steve Rowe, to slash the amount of shopfloor space devoted to M&S’s clothing ranges. The retailer has embarked on a “radical transformation” plan intended to tackle years of falling sales and profits. M&S has confirmed the locations of only 36 store closures so far, including the identities of a further 14 sites that were revealed on Tuesday. The cull is part of a plan announced 18 months ago by the chief executive, Steve Rowe, to slash the amount of shopfloor space devoted to M&S’s clothing ranges.
Initially Rowe said 30 stores would close but as sales move online the company has decided to axe 100, eliminating 25% of the floor space devoted to clothing and homeware. Under the expanded programmes, M&S is eliminating 25% of the floor space devoted to clothing and homewares. M&S has 1,035 stores in the UK, 300 of which sell clothing, homeware and food. There are around 700 Simply Food convenience stores.
Sacha Berendji, the Marks & Spencer retail, operations and property director, said the company was trying to make its store estate “more relevant” and better able to support the growth of its website.Sacha Berendji, the Marks & Spencer retail, operations and property director, said the company was trying to make its store estate “more relevant” and better able to support the growth of its website.
The latest update means the locations of 36 of the stores earmarked for closure have been announced so far. However, with another 64 branches still to be named, the process is creating huge uncertainty for staff. With another 64 branches still to be earmarked for closure under the cuts, the process is creating huge uncertainty for staff. So far the programme has affected 1,500 out of 72,000 UK shop staff at M&S.
“Closing stores isn’t easy but it is vital for the future of M&S,” said Berendji. “Where we have closed stores, we are seeing an encouraging number of customers moving to nearby stores … which is why we’re continuing to transform our estate with pace.” “Closing stores isn’t easy but it is vital for the future of M&S,” Berendji said. “Where we have closed stores, we are seeing an encouraging number of customers moving to nearby stores … which is why we’re continuing to transform our estate with pace.”
Three stores – Bayswater, Fleetwood outlet and Newton Abbot outlet – will close by the end of July while Holloway Road in London and Clacton-on-Sea in Essex will close by early next year as they are replaced by nearby food-only outlets.Three stores – Bayswater, Fleetwood outlet and Newton Abbot outlet – will close by the end of July while Holloway Road in London and Clacton-on-Sea in Essex will close by early next year as they are replaced by nearby food-only outlets.
Darlington, East Kilbride, Falkirk, Kettering, Newmarket, New Mersey Speke, Northampton, Stockton and Walsall are proposed for closure and will enter a period of consultation with 626 affected employees. M&S said it would aim to redeploy staff before considering redundancies. Darlington, East Kilbride, Falkirk, Kettering, Newmarket, New Mersey Speke, Northampton, Stockton and Walsall are proposed for closure and will enter a period of consultation with employees. M&S said it would aim to redeploy staff before considering redundancies.
M&S’s announcement comes as UK retailers line up a wave of closures amid tough trading conditions and rising costs. Last week Mothercare announced plans to shut 50 stores, putting at least 800 jobs at risk. Fashion chain New Look is shutting 60 outlets and House of Fraser is also planning at least 20 closures.
Outside the Holloway Road store on Tuesday, which first opened its doors in 1914, shoppers reacted with shock. The once grand frontage, complete with classical pillars, is pockmarked by holes from previous signage, the windows grimy with old paint and the interior dated. But there was a steady flow of shoppers browsing the clothes as well as the food aisles.
Margaret Late, 68, said she had been visiting the store for about 40 years. “I come down every week but I rarely buy anything as I find it too expensive. I do like to get my underwear here and sometimes my husband’s jeans but I prefer Bonmarche for clothes. It’s cheaper and nicer stuff. It’s a shame for M&S to go, though. It will probably end up as a pound shop.”
Sofya Gaal, 39, said she had been using the store for most of the 22 years she has lived nearby. “It’s a shame it’s closing, it’s probably because of online. I shop online but I like to come out to the shop and get some fresh air. I probably come here three or four times a week.”
The Usdaw national officer David Gill said: “Staff in all M&S stores were extremely concerned about what the future holds when the company announced a wide-ranging store reorganisation in November 2016.The Usdaw national officer David Gill said: “Staff in all M&S stores were extremely concerned about what the future holds when the company announced a wide-ranging store reorganisation in November 2016.
“At the time they did not say where the axe will fall by detailing which stores are set to close,” said Gill. “Today we’ve seen a third wave of closures announced, which is devastating news for the staff in those stores and the uncertainty continues for everyone else. This salami slicing approach to reorganising the business is extremely distressing for the staff.”“At the time they did not say where the axe will fall by detailing which stores are set to close,” said Gill. “Today we’ve seen a third wave of closures announced, which is devastating news for the staff in those stores and the uncertainty continues for everyone else. This salami slicing approach to reorganising the business is extremely distressing for the staff.”
On Wednesday M&S is expected to report pretax profits of £573m, down from £614m in 2017, marking the second consecutive year of declining profits. Sales of clothing and home products at established stores are forecast to be down 1.1%, and food sales down 0.2%. On Wednesday M&S is expected to report pretax profits of £573m, down from £614m in 2017, marking the second consecutive year of declining profits and falling well short of the peak of £1bn reported in 2008. Sales of clothing and home products at established stores are forecast to be down 1.1%, and food sales down 0.2%.
The GlobalData group retail research director, Maureen Hinton, said M&S was in danger of losing its crown as the UK’s largest clothing retailer. One retail consultancy said M&S was in danger of losing its crown as the UK’s largest clothing retailer.
‘‘Marks & Spencer has dominated the UK clothing market for decades, but its lead as number one is perilously close to being lost to Primark this year,” said Hinton. “The closure of yet more stores will hasten the decline unless it can shift the lost sales to its online channel and transfer to its other stores. But it also has to start growing total non-food sales to stem the overall decline.” ‘‘Marks & Spencer has dominated the UK clothing market for decades, but its lead as number one is perilously close to being lost to Primark this year,” said Maureen Hinton, a research director at GlobalData. “The closure of yet more stores will hasten the decline unless it can shift the lost sales to its online channel and transfer to its other stores.”
In 1997 M&S achieved its peak clothing market share of 13.5% in the UK but the past two decades have seen the lead chipped away to 7.6% just ahead of Primark on 7%, according to figures from the GlobalData Retail Intelligence Centre. In 1997 M&S achieved its peak clothing market share of 13.5% in the UK but the past two decades have seen the lead chipped away to 7.6% just ahead of Primark on 7%, according to figures from GlobalData.
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