Marks & Spencer Increase In Sales Of Clothing And Homewares, A Much Needed Sign Of Relief
Marks and Spencer seems to be turning a corner as the retailer managed to post decent sales growth figures for the first time in more than four years. Management remains optimistic that better things are still ahead, but analysts question whether the short trading period is enough to declare that the company has sorted its issues. General merchandise performance improved, as did online sales, in three months ended March 28.
Marks and Spencer reported that sales in the clothing and homeware category increased for the first time in more than four years. The retailer’s CEO, Marc Bolland, praised the development, but isn’t too bullish, only saying that they still have much work to do in moving the company forward in terms of performance.
Online sales rise 13.8% in the three months to March 28.
Marks and Spencer has been promoting heavily to drive sales. However, management cited that the latest uptick in sales did not actually come as a result of heavy promotions. According to Bolland, the level of discounting in the three month period was actually lower than it was a year ago, which means that improvement in general merchandise sales was not heavily influenced by huge discounts.
The news about improvements in homeware and clothing sales is inspiring, but analysts maintain that it cannot be taken as an indication that the retailer has put all its troubles behind it. The reason for caution among analysts is that the good news only covers a small period of trading and more time is required to better understand the turnaround of Marks and Spencer.
Shifting sourcing strategy
The retailer is shifting from depending on third-parties for stock to doing the work itself, by getting directly to factories.
Focus on quality
As Marks and Spencer continues to focus on getting its challenges behind it, the CEO also said that they will continue to focus on quality, as they have always done, which is drawing customers back. The qualities he refers to include high manufacturing standards and ethical sourcing.
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