Marks and Sparks ; News Analysis: SHOPPING IN THE 21ST CENTURY ++ the Return of the Kings of the British High Street ++ Major Revamps and New Strategies Have Boosted the Fortunes of Marks & Spencer, the 'Most Trusted Retailer' in the Country
Rodgers, Report Paul, The Independent on Sunday (London, England)
Profits were in the doldrums, the shareholders were mutinous and a dorsal fin could be seen circling in the tepid, retail waters. Marks & Spencer, once the flagship of high street Britain, was listing badly three years ago. As a new captain, Stuart Rose, was rushed aboard, it seemed all too possible that, like Rumbelows, C&A, and Midland Bank, M&S might sink without trace. At a minimum, it looked likely to lose its independence to rival retailer Sir Philip Green. In short, it showed all the signs of a slow-motion corporate shipwreck.
So the announcement last week that the company's latest profit figures were just a shade below their peak of a decade ago - when M&S became the first UK retailer to pocket a cool [pound]1bn - marked a dramatic change in fortune. The recovery in the share price is even more startling: more than 700p when Mr Rose announced the company's annual results on Tuesday, compared with 171p at its nadir in 2000. And to top it off, he'd recruited dot-com doyenne Martha Lane Fox to be a non-executive board member. The turnaround, he said, was over. Marks and Sparks was ready to play in the big league again.
The return of M&S to shop-ping's premiership will be a relief to anyone who holds to the cricket-and-warm-beer view of national identity. Few Britons have not worn its brand, if only beneath their school uniforms. Even after its fall from grace with the City, M&S still revelled in the sobriquet of "Britain's most trusted retailer". And colonial visitors could always be counted on to list it among the must-see sights.
Yet the chain's origins are anything but British. Michael Marks was a Polish Jew who had fled persecution in Belarus. He set up his first stall in the Kirkgate market, Leeds, in 1884, under the slogan "Don't ask the price, it's a penny". A decade later, he went into partnership with Tom Spencer, a cashier at his main supplier, and together they opened their first full shop in Manchester. Their edge was that they bought directly from manufacturers, cutting out the middlemen.
A boardroom battle after the deaths of the company's founders ended with Marks's son, Simon, taking control. He led the company for 56 years, introducing British shoppers to the luxuries of cafe bars and avocado pears. (One customer is said to have complained that the exotic new fruit didn't go well with custard.) Deep in this rich seam of corporate history, preserved in a secret archive above the Wood Green store in north London, can be found gems. An old design for a tin of biscuits, for example, was recycled a few years ago, becoming a surprise Christmas best-seller. And when Twiggy started modelling the company's clothes again, it was here that photos of her wearing St Michael brand outfits in the 1960s were found.
So it was to Wood Green that the directors of Urban Salon Architects went after being invited to bid for the contract to redesign the M&S estate. Unlike their rivals, they had never done a retail revamp before, so they couldn't show off existing designs. Instead, they produced a chart explaining how the development of ring roads and pedestrianisa-tion had changed the business and predicted the effects of congestion charging and hand-held internet links on its future. After a day of listening to presentations from short-listed firms, M& S executives chose "the people who gave us the geography lecture".
The M&S team likes to em-phasise that getting the "product" and "service" right were just as important as fixing the dowdy stores. And they're surely correct when they say that you can't sell poor goods from a palace. But underestimating the redesign would be a mistake. The vast majority of the improved sales at M&S have come from new or refurbished stores. Other high-street chains are already copying some of the design features. It may not exactly be cutting edge, but the new M&S look is defining the British shopping experience. …