British retailer drops clothing from several stores and closes overseas businesses
Marks and Spencer has announced the planned closure of 60 stores as it announced financial results for the six months ending 1 October 2016.
The retailer announced a further drop to its profits and confirmed that 30 of its UK stores will close. The business also announced plans to withdraw from ten countries.
These are tough decisions, but vital to building a future M&S that is simpler, more relevant, multi-channel and focused on delivering sustainable returns.”
Additionally, 100 UK stores will be revamped in line with the business’ plan to refocus its efforts on food as its fashion business continues to struggle. The plans will see 200 Simply Food stores open across the UK.
53 loss-making stores across the world will also close in the next year, in a bid to cut losses of £45m. However, Marks and Spencer said that it would continue to serve consumers in these regions via franchise agreements.
International stores to survive the cut include Ireland, Hong Kong and the Czech Republic.
Steve Rowe, CEO at Marks and Spencer, said: “Our aim is to build a sustainable business which will delight our customers, provide a robust foundation for future growth and deliver value for our shareholders in the long term.”
Despite the announcement, the retailer said that its fashion business was showing “early signs” of recovery. However, sales were still down 5.3%.
Marks and Spencer is aiming to operate from fewer, but better, clothing and home stores with more Simply Food outlets in a bid to better reflect changing shopping patterns.
Rowe added: “These are tough decisions, but vital to building a future M&S that is simpler, more relevant, multi-channel and focused on delivering sustainable returns.”
Earlier this year, Marks and Spencer announced that it was cutting 525 head office jobs in a bid to cut costs. More than half of these job losses were said to impact contractors.
In July, Marks and Spencer reported its biggest drop in clothing sales since 2008 as like-for-like purchases dropped almost 9%. At the time, Rowe said: “These are not the numbers I wanted to see – not by any stretch.”
Marks and Spencer will also close ten stores in China and seven in France.