A year on from his appointment as M&S’s executive director of food, Steve Rowe can be congratulated for making a good business better. This time last year, M&S reported like-for-like sales growth in food of 1.1% for the first half of 2012/ 2013. It was a solid result considering the state of the market at the time.
This year, with little uplift in the wider grocery market, M&S has delivered an increase of 2.5%. In addition, gross margins increased by 50 basis points – ahead of the 35 basis-point increase seen last year.
M&S’ innovation in food continues apace – this morning CEO Marc Bolland highlighted the 4.4 million meals, salads and sandwiches sold from its new Delicious & Nutritious range. But the key to this year’s improved performance is more operational. The number of stores stocking the full M&S food catalogue has risen from zero to 70 and the average number of facings across the estate has risen by 18% in the past year.
All things being equal, you’d expect this broadening of the range to put pressure on availability, but M&S has simultaneously increased availability in food by 1%.
Although the drive to improve availability and increase facings started before he took charge of the food business, Rowe can take credit for accelerating progress.
Suppliers praise him for making the food business more agile and simplifying decision making.
Rowe also has a clear idea of how to continue growing the business. He’s working hard to fill gaps in the M&S offer by entering new categories, such as babyfood and frozen ready meals, and improving ranges in areas where M&S under-trades – one particular bugbear of his is why M&S can sell so many roasts and yet few shoppers buy their potatoes from the retailer.
The health of the M&S food business contrasts with continued weakness in clothing and homeware. This week, M&S posted its ninth consecutive quarter of falling like-for-like general merchandise sales. Although the decline was less severe in the latest quarter, Bolland needs to see the division return to growth if he is to silence critics who claim his lack of experience in clothing is to blame for weak sales.
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