>>there’s never been a better time for M& S’ food business
It’s crunch time for Stuart Rose and the new Marks and Spencer management team. Having rejected Philip Green’s latest indicative offer of £9.1bn for the business, they must now persuade the City that they have got the right strategy to deliver the goods for shareholders.
As we went to press, it was still unclear what Green would do next. The retail entrepreneur has said all along that he does not want to mount a hostile bid for M& S, and he grumbled this week: “If they don’t want my money, I’ll go and sit on a beach.”
Whether or not Green does decide to go and sit on his beach, Rose has the chance on Monday to seize the initiative. He needs to show that he has a credible plan for restoring the fortunes of the M&S business. Clearly, much of his focus will be on general merchandise, but the food business has been stumbling recently.
So what’s to be done about that? Well, as we reported last week, sharper prices from suppliers, a more targeted npd programme and a renewed emphasis on quality are priorities. And, as we explain on page 26, Rose is also widely expected to scale back plans for the rollout of the Simply Food convenience format.
Whatever the detail of Rose’s strategy for food, critical to its success will be ensuring that M&S can continue to differentiate itself from its supermarket rivals. That’s easier said than done because they have been pretty good at competing on core M&S territory in recent years. There’s another challenge; every week the M&S food business serves the same number of customers as some of the major multiples, but getting these shoppers to spend more each trip has proved difficult.
Nevertheless, the problems at Sainsbury and the upheaval at Safeway means there are plenty of disgruntled foodies out there looking for a new place to shop. Many are already going to Waitrose, which is now going national and, I guess, presenting another potential headache for Rose and his food team.
But, given the changes underway at two of its major rivals, there’s arguably never been a better time for the M&S food business - so long as it has the right growth strategy in place.
It is going to be fascinating to see what Rose delivers on Monday. One thing’s for sure, though. If he doesn’t impress the City, he may well find that Green is right - for retailers, at least, life can sometimes be a beach.
life’s a beach for retailers
It’s crunch time for Stuart Rose and the new Marks and Spencer management team. Having rejected Philip Green’s latest indicative offer of £9.1bn for the business, they must now persuade the City that they have got the right strategy to deliver the goods for shareholders.
As we went to press, it was still unclear what Green would do next. The retail entrepreneur has said all along that he does not want to mount a hostile bid for M& S, and he grumbled this week: “If they don’t want my money, I’ll go and sit on a beach.”
Whether or not Green does decide to go and sit on his beach, Rose has the chance on Monday to seize the initiative. He needs to show that he has a credible plan for restoring the fortunes of the M&S business. Clearly, much of his focus will be on general merchandise, but the food business has been stumbling recently.
So what’s to be done about that? Well, as we reported last week, sharper prices from suppliers, a more targeted npd programme and a renewed emphasis on quality are priorities. And, as we explain on page 26, Rose is also widely expected to scale back plans for the rollout of the Simply Food convenience format.
Whatever the detail of Rose’s strategy for food, critical to its success will be ensuring that M&S can continue to differentiate itself from its supermarket rivals. That’s easier said than done because they have been pretty good at competing on core M&S territory in recent years. There’s another challenge; every week the M&S food business serves the same number of customers as some of the major multiples, but getting these shoppers to spend more each trip has proved difficult.
Nevertheless, the problems at Sainsbury and the upheaval at Safeway means there are plenty of disgruntled foodies out there looking for a new place to shop. Many are already going to Waitrose, which is now going national and, I guess, presenting another potential headache for Rose and his food team.
But, given the changes underway at two of its major rivals, there’s arguably never been a better time for the M&S food business - so long as it has the right growth strategy in place.
It is going to be fascinating to see what Rose delivers on Monday. One thing’s for sure, though. If he doesn’t impress the City, he may well find that Green is right - for retailers, at least, life can sometimes be a beach.
life’s a beach for retailers
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