Marks & Spencer is the UK's leading clothing retailer. It has 375 UK
stores selling clothing, food and household furnishings. It also has 43
company-owned stores abroad, mainly in the USA and Hong Kong,
and 155 franchise stores in various countries. It accounts for almost
10.8% of UK clothing and footwear sales. Its food sales are almost as
important as clothing but its share of the UK food market is smaller.
Since the late 1990s its sales and profits have fallen, albeit with some
recovery, and it has lost market share. At one time Marks & Spencer
was renowned for its steady progress, and for being the UK's most
profitable retailer. But it lost that standing. It gained a reputation for
high prices-partly as a result of its policy of sourcing mainly within the
UK. The stores became unattractive, the supply chain was inefficient,
and the company was complacent. Discount clothing retailers gained
ground, supermarkets became a major force in clothing retailing, and
smaller chains offered more stylish clothing. Marks & Spencer also
withdrew from most of its non-UK company-owned operations.
The company acknowledges many of its problems. It sources 90% of
its clothing from outside the UK. Also it is working to improve the
supply chain and the stores, and to provide the clothing that its core
customers want. One of Marks & Spencer's strengths lies in lingerie,
where it accounts for over a quarter of the UK market. Another lies
in selling clothes for over-45 year olds-although sales to the
under-35s remain weak. The company's sales and pre-tax profits, at
£8.3 bn and £782 mn respectively in 2003/04, are still substantial. But
progress has been patchy during its recovery phase. Clothing sales
fell in 2004/05 and the company continues to face stiff competition. | 
