Marks & Spencer, the high street retailer, surpassed all market expectations after its sales surge improved its bottom-line. The like-for-like sales for the 12 weeks up to October 1 were up by 1.3 per cent as against a fall of 5.4 per cent in the previous quarter. While food sales showed a healthy increase, the sales of clothing evened out.
These results will only bolster the stature of Mr. Stuart Rose, the chief executive. Under pressure from Philip Green of BHS who offered £9.1 billion in order to acquire M&S, Mr. Rose had to perform or perish.
That M&S achieved this turnaround weathering odds like slowdown in retail market, fall in house prices and other none-too-impressive conditions, Mr. Rose’s performance is considered remarkable.
Reacting to the results, Rose said: "This is an encouraging performance, but there remains much to be done". Though there were apprehensions in the market ahead of Christmas season, Mr. Rose was confident that M&S “would deliver”.
Rose had introduced several measures which are attributed to the success of M&S. They include, among others, renegotiation of supplier contracts, restructuring of the company's pricing structure and improved stock management.
While M&S did not report an increase in general merchandise including clothing and homewares, the rot was stemmed with the sales down by just 0.2 per cent compared with an 11.2 per cent fall in the first quarter. The total group sales were up by 3.3 per cent.
Offers such as £1 pairs of socks and £20 jeans were reported to be luring customers by the dozen. If things continue to go in the same vein, it wouldn’t be long before M&S will eat into its rivals’ market share, it is averred.
Meanwhile, shares in M&S reached their highest level in over three years just below the 400p level. This was the price that Philip Green had reportedly offered to buy out M&S.
Posted
on : Wed, 12 Oct 2005 08:35 GMT | Business News
By : Rob Davis
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