Marks and Spencer: share and store

When I worked as fashion editor of a national newspaper, I was  always surprised how infrequently the financial desk contacted me for my views on fashion and retail.  As I prepped up for this article I called Bob Tickler who is big on product and service in deciding an investment. He told me in yesterday’s business section of the Telegraph a guru had advanced the theory that delivering value to shareholder should not be the main aim  of a company and it was better to concentrate on product and staff relations. That is why he has invested in Easy Jet and  its shares have risen by 12% since he bought in less than month ago. Marks and Spencers whilst still being one of the big four has struggled with its product position and image these past few years. It seems to me that it’s  insufficiently in touch with its loyal client base and unable to attract a newer younger one especially in womenswear. It still has a justified reputation for quality and its food division continues to perform well.

Before lunch with Daffers last Sunday I dropped into the main Brighton store opposite the Churchill Centre. I wanted to buy a cashmere sweater for my other half but couldn’t find a colour or size to suit. Crucially I had no help and left the department empty-handed. In the home section I searched for a flowerpot to no avail. I could not see the point of this section at all – it was too small, had little range and I could see no buying activity. I had to walk through ladies’ wear and could not identify a philosophy. The clientele was old but, instead of showing safe reliable clothes, they had for example a daring lingerie range a la Agent Provocateur for the wrong consumer. Brighton is the gay capital of England and – without stereotyping gay people – they tend to like brighter colours but it seemed fashion was dictated by head office not the local tastes. My conclusion was that M & S has a long way to go to recover those heady days when it dominated the retail clothing trade.

After we had poured Daffers kicking and screaming in her Loubertin heels into a taxi whilst she was reminiscing about a night in the seventies at the Pheasantry in Kings Road with Mick Jagger and Charlie Watts I went to Brighton Marina to visit some friends. Here I vsited ASDA, now part of US giant Walmart. Here was a store clearly in touch with its consumers desiring value and delivering the stuff they wanted. Upstairs George offers a low cost clothing range and I bought some baby wear for a friend. I commented to the friendly check out girl that I liked the colours and we both agreed that with babies outgrowing clothes so quickly it was sensible not to spend too much.

The other problem  that the big four (Morrisons, M&S, Sainsbury and Tesco) have is that they are so obsessed with positions and the market share of each other that they fail to notice a clever intruder like Aldi or Lidl, both of which outmanoeuvre them in terms of price. So my conclusion, which I explained to Robert. was that I would not invest in the store sector. Bob said I should launch the Shillingford Retail Fund.