This morning’s news should not divert from the company’s Trading Statement. The GM numbers are dreadful, though not surprising. Our Promotional Tracker shows Marks has been on sale 11 out of the past 12 trading weeks. It is clear that further ground has been lost but at -5.8%, the GM LFLs are even worse than expected.
For some time now, the timing of CEO succession at M&S has been a key topic of trade chatter. Now that it has finally happened it has taken everyone by surprise. Especially since Marc Bolland told the market he was staying just a few months ago. The other surprise is his replacement. Most expected an external appointment and Steve Rowe has no CEO experience, but he brings many material compensations.
He has worked all his career at Marks. Indeed, his father was on the main Board for many years and I remember him well as a grounded, thoughtful member of the very solid team running M&S in its pomp during the 1980s. Steve will bring a significant change in style. He has a unifying, collegiate approach and most important of all, he is a retailer. He is an old school, down to earth, merchant. He favours substance over style, another very welcome change.
Of course the biggest thing of all hasn’t changed a bit: the issues the business faces. His prospects of effectively addressing these issues inevitably depends on his diagnosis of them and choice of remedies. It’s much less about digital, infrastructure etc and much more about selling. The clues are in the trading record. He inherits a damaged fashion brand in the toughest market we have ever seen. And womenswear is still the pivotal part of the business. Getting this right is the unequivocal key to recovering performance. It’s also by far the biggest challenge of all.
This development is in my view the most positive we have seen from M&S for some time. The task is monumental but it offers some genuine hope of progress.
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