As part of a “radical transformation”, Marks & Spencer (LON: MKS) has announced plans to close over 100 stores by 2022.
The revamp started in November 2016 and has already led to the closure of 21 stores, with a further 14 announced today.
Sacha Berendji, director of retail operations, said: Closing stores isn’t easy but it is vital for the future of M&S.”
“We are making good progress with our plans to reshape our store estate to be more relevant to our customers and support our online growth plans.”
“Where we have closed stores, we are seeing an encouraging number of customers moving to nearby stores and enjoying shopping with us in a better environment, which is why we’re continuing to transform our estate with pace.”
The retailer announced last month plans to close a distribution centre in September. The facility at Hardwick Grange, near Warrington, will risk 450 jobs.
“It was not a decision we took lightly and it is not in any way a reflection on the hard work and dedication provided by the teams on site,” said Gordon Mowat, a director at M&S.
Chris Beauchamp, the chief market analyst at IG Group, said the store closures were important to bring down costs.
“M&S remains in the throes of a turnaround strategy, as it looks to make its long-underperforming clothing division more competitive,” he said.
“Continued expansion for its food division has helped to keep revenue moving higher at this part of the business, but its move into online is taking longer than thought, while its competition from other stores in the mid-price part of the spectrum limits performance. Margin improvements are crucial, but this is a longer-term process, however continued store closures will help reduce some fixed costs.”
The latest stores affected by the announced closures include Bayswater, Fleetwood (Outlet store), Newton Abbot (Outlet store), Holloway Road, Darlington and New Market.
Following news of the closures, shares fell three percent.