M&S breaks with tradition to get more agile on style

Wed Mar 4, 2015 6:57am EST
 
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By James Davey and Emma Thomasson

LONDON (Reuters) - Shoppers usually blame dowdy clothes and tired stores for the painful decline of Britain's former retail powerhouse Marks & Spencer (MKS.L: Quote). But the parts of the business that customers never see could hold the key to its revival.

After hiring new designers, overhauling its online offering and giving a facelift to stores, M&S still needs to push home its most ambitious project: overturning more than a century of retail history by taking full control of its supply chain.

The drive to design more products in-house and then source them faster and more flexibly is a radical departure for a company that, since its founding in 1884, has relied on third-party suppliers to create, manufacture and ship most of its garments.

Long-term relationships with those mostly British-based firms, based on big orders and long lead times, helped M&S keep prices down and build a reputation for quality.

But as its most loyal customers - women aged 50-plus - have become more fashion-conscious, the middlemen have hampered M&S's ability to quickly refresh supplies of fast-selling items before shopper interest tails off.

"There’s a killing to be made if they can serve older women better," said Patsy Perry, a lecturer in fashion marketing at the University of Manchester. "Unless you have money to buy designer clothes, it’s hard to find what you want on the high street unless you want to look like your daughter."

Even as new M&S womenswear collections won praise from the fashion press, shoppers often found the clothes were sold out in their size or were not appropriate for the weather.

In contrast, nimble retailers like Zara-owner Inditex (ITX.MC: Quote), H&M (HMb.ST: Quote) and Next (NXT.L: Quote), which have more direct control over factories, replenish their stores faster and offer a more frequent turnover of styles.   Continued...

 
Pedestrians walk past an M&S shop in northwest London July 8, 2014. REUTERS/Suzanne Plunkett