Marks & Spencer To Move Away From Town Centres
In response to declining town centre footfall and extortionate business rates Marks & Spencer has announced a company restructure.
The high street chain said that customers have made a significant jump to online shopping for clothes and homeware. This online shift has resulted in a company decision to relocate some the long established, multi-level M&S stores from town centres to edge of town retail parks.
The retailer commented that many town centres had “lost impetus” due to “failed local authority or government policy,” and that “a high proportion, but not all, of our relocations are to the edge of town.”
M&S stated that over the next three years it was planning around 15 new full-line stores and 40 new food stores.
Christophe Pecoraro, Managing Director of PFS Europe commented on the news:
“The news that Marks & Spencer plans to shift its stores away from town centres, driven by a surge in online sales and the need to move their shops where customers are working and shopping, is a stark reminder that traditional retailers must adapt in order to keep pace with evolving customer demands and expectations. For Marks & Spencer, an overhaul of its business strategy and strong performance in its clothing and home operations online has seen sales rebound after years of decline. High streets, however, are rapidly losing their value and with physical stores paying 755% more in business rates tax than their online counterparts, there is an urgent need re-evaluate the current high street model.
“Stores should be rethought and reworked into physical touch points presenting an integrated experience with the online channel. Rather than working in isolation, physical stores need to make online shopping easier, to retain their value. For this to be successful, a hybrid approach is needed, bridging the gap between online and offline channels through concepts such as in-store fulfilment or by adopting a Dark Store model, which utilises space within stores as a distribution and shipping location to fulfil online orders. This allows retailers to make their store locations work twice as hard by doubling up as physical stores with micro distribution centres within them – enabling brands to keep up with eCommerce demands, whilst still being able to physically interact with customers.
“Marks & Spencer isn’t the first and certainly won’t be the last traditional retailer to rethink its physical presence in town centres. In order to save our high street, a hybrid approach underpinned by omnichannel fulfilment capabilities will be crucial – to not only inject value back into brick-and-mortar retail but also keep up in a digital-first era.”