Wednesday, 7 November 2012

Profit and Loss for M&S

A bumpy couple of weeks for M&S. Possibly our most eco-friendly high street store made headlines by signing up to Greenpeace's Detox challenge, and pledging to remove all toxic chemicals from its clothes manufacturing by 2020. This is a big step, but one that's completely in tune with the chain's Plan A initiative to green up their supply chain.

However, the news isn't all good. Their first-half financial report, just released, shows a sharp drop in profits, down 6%. The blame for this seems to point at that pesky supply chain--specifically, failure to get the clothes that they were TV-advertising into the shops in sufficient quantity.

This compares dismally with Primark, whose first-half profits have bounced up by 15% in the same period. Which just goes to show the harsh rule of retail. You can be as virtuous as you like in your company philosophy. You can recycle and shwop all the clothes you like. But if you can't get your products to your customers, then that's a major problem. There's a reason it's called fast fashion. Primark succeed by responding quickly and in volume to rapidly changing trends. Sadly, until M&S learn that lesson, they're not going to make inroads into that market and perhaps persuade the fickle British consumer to change their ways.

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