Home Retail M&S to close 68 stores but no decision on Inverness or Aberdeen

M&S to close 68 stores but no decision on Inverness or Aberdeen

by Ozva Admin

Retailer Marks and Spencer said it was accelerating the closure of 68 UK stores as it prepares to weather “stormy weather” with a “simpler and more efficient business”.

A spokeswoman said there was “no new news today” to report on the fate of so-called “full line” stores in Inverness and Aberdeen as concerns remain about whether stores in these cities may be for chop.

In a mid-year update revealing a drop in profit, M&S provided a bit more insight into what it was looking for in a “reformed” chain store.

M&S is keeping quiet about the fate of superstores like the one in Aberdeen’s Bon Accord centre. Image: Paul Glendell/DC Thomson

The firm said its holdings of 248 department stores contained a “low productivity tail” where profits in clothing and home goods were lower, as well as failing to reach expected levels of profitability in online sales.

Its goal is to replace some of these with a “more focused” group of full-line stores that are “omnichannel retail-capable,” offering more space for food retail that includes click-and-collect capability and , more importantly, are “least cost to run”.

It pointed to areas where three “legacy” stores in Colchester and Stevenage were replaced by two outlets of the new format.

In its statement to the London Stock Exchange, M&S said it was “grabbing nettles to accelerate change” with the aim of “accelerating a five-year plan to reduce the net store base from currently 248 stores to approximately 180. through closings and moves.”

It also highlighted that its earnings were also hit by the cost of higher property taxes after the end of business rate relief.

Charge of commercial rates

The imposition of business fees is once again becoming a major concern for retailers as well as restaurants, bars and hotels.

An expected rise in business rates in the spring may plunge many businesses into a fight for survival. particularly among retailers, figures have shown.

In Aberdeen, M&S currently operates two large stores, including a full-line store on St Nicholas Street and a food and home goods store in Union Square Shopping Centre.

Inverness has a full line branch at East Gate Mall.

Meanwhile, M&S Food said it plans to open around 100 larger-format food stores in new locations over the next five years.

Next year ‘most challenging’

M&S said it expects market conditions to become “more challenging” in 2023-24.

He said: “The combined impacts of the declining cost of living and the sharpest increase in the cost of doing business for many years are creating pressure on margins across the industry.

“All parts of the retail sector will be affected, and this will result in unviable capacity leaving the industry, creating opportunities for the smallest remaining players.”

The gloomy outlook came as it reported a 23.7% drop in underlying profit before tax to £205.5m in the six months to October 1 as it saw double-digit cost inflation food and suffered a £700,000 loss on their Ocado retail joint venture. .

Chief Executive Officer Stuart Machin said: “Our store’s heritage renewal and rotation program is driving sales and rapid returns, while the M&S app now accounts for more than a third of online clothing and home sales.

“Backing up our business is an improved balance sheet with reduced debt and a strong cash position.”

M&S shares closed down 3.4% at 113.10 pence

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[M&S to close 68 stores but no decision on Inverness or Aberdeen]

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