Marks & Spencer to close five stores in China

Marks & Spencer is to close five stores in China and shrink its Shanghai head office as part of a strategic shake-up, the British retailer said today.

Marks & Spencer to close five stores in China

Marks & Spencer is to close five stores in China and shrink its Shanghai head office as part of a strategic shake-up, the British retailer said today.

M&S set out details of its plans, first outlined last year, which will see 60 jobs cut and the total number of sites in China fall from 15 to 10.

But the retailer aims to return to 15 stores over time starting with a “firm intent” to enter key cities such as Beijing and Guangzhou from the 2015/16 financial year which starts next month.

M&S said: “As announced in April 2014, Marks & Spencer has reviewed the shape of its existing store portfolio to ensure it’s best aligned with its strategic growth plans.

“As a result, Marks & Spencer has taken the decision to close five of its supporting stores in the greater Shanghai region by August 2015. It has also reviewed its head office resource structure in line with growth plans.”

The retailer said it would continue to invest in existing flagship stores with plans for the complete modernisation of its central store in Shanghai this autumn.

Marks’s new strategy in China involves focusing on central locations in the larger cities as well as strengthening its web presence – which has recently seen it launch a new childrenswear online store.

M&S also said it was “evaluating potential partners” for the business. It is looking at the possibility of a joint venture arrangement along the lines of its operation in India.

Meanwhile it is also investing in Hong Kong, where it has 18 stores, and expanding its food store portfolio after three standalone locations opened since last year performed as well as its most successful UK M&S Simply Food outlets.

Marks is also opening a new store in Macau in November 2015. It opened its first store in Hong Kong in 1988 and in China in 2008.

In the UK, falling clothing sales at M&S have piled pressure on the group’s chief executive Marc Bolland. Its key Christmas trading period was beset by online delivery problems.

Full-year sales to the end of last March in its international division were up 6.2% to £1.15 billion, including 15.7% growth in Asia.

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