Marks & Spencer must reinvent itself from the U.K. to the Gulf
The iconic Marks & Spencer retailer (turnover of €12.2 billion in the year to late March 2019 via 1,035 stores in the U.K. and 428 internationally) has been knocked off a pedestal. On September 23rd this century-old company, one of the pillars of the British stock index, was removed from the Footsie exchange, no longer part of the 100 largest capitalisations of the British financial market. For many years Marks & Spencer lost ground in the two main businesses. Food accounts for 62.5% of the business and fashion & home earns 37.5%. On September 4th its stock market value dropped to €4.2 billion, removing M&S from the “Top 100”. As a comparison, the value of rival Next on the same day was €8.9 billion. As a symptom of this malaise, the Saudi group Fawaz Abdulaziz Alhokair, a partner of many fashion retailers in the Gulf via franchising agreements (turnover of €139 million in 2018) ended the partnership with the British retailer quoting a “lack of performance”. In Saudi Arabia, 15 M&S franchised stores are being transferred to Al Futtaim Group. Last year, the international sales of M&S fell by 13%.