Suppliers have questioned Marks & Spencer's decision to slash the number of branded food products it sells from 400 to 100.

CEO Marc Bolland announced the cull in his business review last week, stressing that 300 SKUs rather than 300 actual brands would be delisted to avoid duplication and make room for around 1,000 extra own-label lines.

"I always evaluate using the 80/20 rule 20% of the brands are doing 80% of the selling," he said. "We are not taking away brands, we are taking away SKUs. We'll still have Tabasco and Coke but will we have four or five SKUs of the same brand? No."

Although suppliers were pleased M&S had decided not to ditch branded food completely, they questioned whether slashing the range was the right decision, especially as the retailer revealed in May this year that branded products had helped contribute to strong like-for-like growth in the stores where the range had been trialled.

"I don't think they've made it very clear," said one source. "It's still very early days, and I understand people were surprised internally that Bolland revealed a specific number when nothing has been decided."

Limiting brands to just one SKU would not be straightforward because shoppers alternated SKUs for their needs, such as a large bottle of Coca-Cola for home and a can for on-the-go, the source warned.

M&S also disappointed analysts by failing to commit to online groceries. Investec said offering a full food range combined with home delivery would increase basket sizes.

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Editor's Comment: Bolland did not compare M&S with Waitrose this time (13 November 2010)
Bolland cuts back the brands in new M&S masterplan (9 November 2010)

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