M&S has announced a £480m investment in "bigger, better stores" across the UK in a move that is set to generate over 3400 new jobs and create a "fit for the future M&S store estate and a seamless experience for customers".
At its recent investor day, M&S shared its ambition to accelerate its five-year store rotation programme, and target a delivery within three years. M&S has already identified a pipeline of 20 new stores to be opened in the next financial year.
Stuart Machin, chief executive, comments: “Stores are a core part of M&S’ omnichannel future and serve as a competitive advantage for how customers want to shop today. Our store rotation programme is about making sure we have the right stores, in the right place, with the right space, and we’re aiming to rotate from the 247 stores we have today to 180 higher-quality, higher-productivity full-line stores that sell our full clothing, home and food offer, while also opening over 100 bigger, better food sites.
"The performance of our recently relocated and renewed stores give us the confidence to go faster in our plan. Our investment in stores not only delivers a better experience for customers and colleagues, it boosts local communities with new job creation and will help us deliver a more sustainable estate in every sense.”
The new store pipeline for 23/24 includes eight full-line destination stores in key city locations, including a new 97,000 sqft store in Leeds White Rose and a 70,000 sqft store in Liverpool ONE, both due to open this summer. Later in the year, other major stores will open, including a 65,000 sqft store in Birmingham Bullring (autumn 2023), a 96,000 sqft store in Manchester’s Trafford Centre and a 98,000 sqft store in Lakeside Thurrock, both set to open in the winter.
All five new stores will be relocated to former Debenhams sites – part of M&S’ investment to regenerate currently vacant sites. Each has been designed with local families in mind, with shoppers able to browse in settings with wider aisles and a clear line of sight, with fresh market-style food halls stocking the full M&S Food range, spacious Clothing, Home and Beauty departments, brand-new M&S cafes, sustainable innovations such as Fill Your Own, as well as free car parking to make shopping more convenient for customers.
Alongside full-line sites, M&S has planned investment in 12 new food halls in communities across the UK. These include a 16,000 sqft store in Stockport opening in the summer, a 12,000 sqft store in Barnsley (South Yorkshire) opening in the autumn, and a 9000 sqft store in Largs (a seaside town in North Ayrshire, about 33 miles from Glasgow) opening in the winter.
In addition to its owned store investment, M&S has plans to extend its franchise model to expand its convenience offer.
The performance of M&S’ new and recently renewed stores have exceeded the retailers’ expectations. In Colchester, for example, Clothing & Home sales grew +26% ahead of plans, while in Lllandudno, Clothing & Home sales were up +35% and food sales up +75%.
Through the store rotation programme, M&S will see a reduction in lease liability (£309m).
The store rotation programme is underpinned by a substantial investment in new digital services, including the roll-out of Digital Click & Collect to 130 stores, enabling customers to collect their parcel in under 60 seconds, and Scan & Shop, which is used by around 33,000 customers each week and lets customers use their phone to scan and bag food items as they shop, directly from the M&S app.
M&S says that funding the programme will require the release of development value that exists in some of its older sites across the UK. M&S owns around 40% of its estate, including its Marble Arch site.