Marks & Spencer profits dropped to hit a three-decade low at £403m, before exceptional items . M&S said it was in talks with landlords over leases and failed to rule out more store closures as the coronavrius prompted it to accelerate an existing overhaul of the business (The Financial Times £). The retailer has devised a £1bn action plan to ensure that it had the financial headroom needed to weather the crisis, including tackling its mountain of stock and slashing spending (The Times £).
CEO Steve Rowe has said the coronavirus crisis has triggered changes in consumer behaviour, with some likely to endure. Sales of suits and ties have flatlined as shoppers work from home but there has been an uptick in sales of stretchy clothes (The Guardian, BBC).
From September, shoppers will be able to buy M&S underwear and children school clothing on Ocado, alongside the upmarket grocer’s food products as the tie-up between the two rolls out (The Telegraph).
Meanwhile, the FT argued that M&S’ clothing division is “almost certainly a lost cause”. The retailer can now blame the effects of the coronavirus for hefty writedowns in unsold garments but, had it switched online faster, things might have looked different (The Financial Times £).
And while it recently came up with a new slogan “never the same again”, The Telegraph argues M&S will need more than clever slogans to survive. “M&S has tried every trick in the book and although there is some truth to claims that ‘both major businesses were making good progress’ under its latest ‘transformation programme’, it seems unable to halt the general trajectory” (The Telegraph).
Supermarkets are in line to receive millions back of wrongly paid tax, after the UK’s Supreme Court ruled that retailers did not have to pay business rates on cash machines following a long-running legal dispute (The Financial Times £). Grocers including Tesco and Sainsbury’s could be in line for payouts of around £500m (The Telegraph). The seven-year legal spat on business rated for ATMs was finally out to an end yesterday, after the Supreme Court rules in favour of retailer (The Times £).
“Can Facebook Shops take on Amazon? Probably not. But Facebook’s venture is as much about advertising as it is online sales”, argued the FT (The Financial Times £).
Ecommerce platform Shopify is rolling out new services, including venturing into the grocery sector, as it tris to benefit from the coronavirus pandemic. With shops forced to close under lockdown, many retailers have turned to Shopify to provide back-end services for e-commerce and the business’s market valuation has more than doubled since early April to above $80bn (The Financial Times £).
UK farmers are facing uncertainty when it comes to fruit and vegetable picking jobs as they fear Brits who have stepped up during lockdown may quit as restrictions ease. In any case, industry representatives said farmers still needed to recruit – and retain – as many as 40,000 British residents to harvest fruit and vegetables to replace the numbers generally coming from abroad (The Guardian).
Just Eat’s third largest shareholder, SM Trust, has sold its entire £460m stake in the delivery business saying that after 15 years “it was time to go” (The Times £).
McDonald’s has reopened 33 drive through restaurants in the UK as it prepares to get back to business. Earlier in May the fast food chain had reopened 15 restaurants for deliveries (The Guardian).
Kellogg’s has pulled a Pringles ad from Joe Wicks Youtube videos after what originally started as fit sessions for adults were extended to include children (The Guardian).
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