Marks & Spencer to expand online reach in latest overseas foray

[LONDON] Marks & Spencer Group Plc will launch websites in 46 new overseas markets to try to revive an international business that's languished for years in spite of multiple turnaround efforts.

The British seller of food, clothing and housewares said the expansion into nations from Nepal to Bolivia and Uzbekistan would extend its online reach to more than 100 countries in a cost-effective way.

Paul Friston, the international director at M&S, said online sales to customers abroad are soaring since the start of the pandemic, jumping by 75 per cent in the first half alone as more people worldwide favor shopping from home. The new websites will offer a range of clothing and home products, with orders fulfilled through the company's existing distribution network.

The push will allow the retailer to "explore underlying demand in these markets without significant upfront investment," Mr Friston said in a statement.

A household name in Britain, Marks & Spencer sells both online and through hundreds of stores across the country. Profitability has been falling for years, however, hurt by a long-struggling clothing and home division and wider structural changes in the highly competitive UK market.

The international business has also had a mixed record over the past decade, with the brand's franchise arm generally performing better than wholly-owned stores.

European Retreat

In 2011, under former Chief Executive Officer Marc Bolland, Marks & Spencer returned to France with much fanfare after a 10-year absence. It opened a flagship store on the Champs-Elysees in Paris, which Mr Bolland heralded as a symbol of its success abroad. But within several years the retailer was in retreat. It shut that store, along with scores more unprofitable outlets across Europe.

In the past decade, operating profit in M&S's international division has fallen from 147 million pounds (S$273 million) to just over 110 million pounds on revenue that has largely hovered around one billion pounds.

Steve Rowe, the CEO leading the latest turnaround effort, said in May the retailer had completed the first phase of transforming the international business by moving away from direct ownership to a franchise and joint-venture model. Now the focus is on "localising ranges, reducing prices and developing sales online globally," he said.

BLOOMBERG