Inside food & drink manufacturing

Hot Topics > Retailing Crisis

M&S Food sales drop is ‘concerning’: analyst

Post a comment
Matt Atherton

By Matt Atherton+

Last updated on 11-Jul-2017 at 16:54 GMT2017-07-11T16:54:59Z

Marks and Spencer's food like-for-like sales dropped 0.1%
Marks and Spencer's food like-for-like sales dropped 0.1%

Marks and Spencer’s (M&S’s) 0.1% drop in like-for-like food sales in its first quarter is concerning, according to Economist Intelligence Unit (EIU), the forecasting and advisory services group.

The fall in like-for-like sales was worrying, given that M&S could usually rely on food to boost its overall performance, EIU said. The Food division reported sales of £1.407M in the 13 weeks to July 1, M&S reported today (July 11).

Economist Intelligence Unit retail analyst Jon Copestake said: “Of more concern [than a drop in like-for-like clothing sales] is the like-for-like fall in food sales being reported, given that food and groceries have represented a bright spot for M&S in recent years.

‘The good news’

“The good news is that food sales are continuing to see fairly solid overall growth, thanks to store openings. Nevertheless, there remains much to do for the incoming chairman [Archie Norman] when he takes the helm in September.”

M&S chief executive Steve Rowe said the retailer had delivered “strong growth” in its Food business over the 13 weeks, after opening more stores and introducing better offers.

Rowe said: “In our Food business, we delivered strong growth from new Simply Food openings, and are prioritising better ranging and stronger promotions.”

On-track to meet expectations

The overall M&S group was on-track to meet its expectations, Rowe said. Group year-on-year sales were up 2.7% to £2.532M (up 1.8% in constant currency).

The fall in Food like-for-like sales came after M&S in May reported a £312.4M drop in profits for last year. In the year to April 1, M&S opened 68 Simply Food stores, but like-for-like food sales fell by 0.8%.

Meanwhile, former ITV and Hobbycraft chairman Archie Norman will join M&S as non-executive chairman from September 1, the retailer revealed in May. Norman will succeed Robert Swannell, who will retire from the board.

M&S trading update – at a glance
  • Food like-for-like sales down 0.1% to £1.407M
  • Fall in like-for-like sales “concerning”, said analyst
  • Group year-on-year sales up 1.8% in constant currency

Post a comment

Comment title *
Your comment *
Your name *
Your email *

We will not publish your email on the site

I agree to Terms and Conditions

These comments have not been moderated. You are encouraged to participate with comments that are relevant to our news stories. You should not post comments that are abusive, threatening, defamatory, misleading or invasive of privacy. For the full terms and conditions for commenting see clause 7 of our Terms and Conditions ‘Participating in Online Communities’. These terms may be updated from time to time, so please read them before posting a comment. Any comment that violates these terms may be removed in its entirety as we do not edit comments. If you wish to complain about a comment please use the "REPORT ABUSE" button or contact the editors.

Related products