Marks & Spencer’s grocery arm is fighting to get the recipe right after a troubling 18 months. What fresh ideas can its new high-profile team cook up?

For the year ending March 31, food revenue grew 3.9% but like-for-likes slipped 0.3% – a lacklustre result for what was once the darling department of the high street giant.

M&S chiefs admitted disappointment with the performance and have brought in high-profile hires to “recalibrate” the food division. Former Sainsbury’s and Tesco director Stuart Machin was hired in March to spearhead its efforts.

Machin has wasted no time in putting together his food dream team to make M&S Food great again.

Former Tesco commercial director George Wright will head trading and the supply chain from late 2019. He has over 30 years of food experience covering buying, commercial management and trading both in the supply chain and for retailers.

And April Preston, who has been leading the transformation of Harrods’ food hall, has been rehired as product development director.

Preston has a long and illustrious food career spanning over 30 years, including 18 years working at M&S where she was responsible for developing over 10,000 products.

Competitors catch up

One of the main challenges M&S must contend with is the improved offering from hard discounters such as Lidl and Aldi and frozen food specialist Iceland. All three chains have invested heavily in their premium ranges.

With this in mind, M&S has announced a strategy to “protect the best and modernise the rest”. The “best” being its range of international and occasion food, according to Bryan Roberts, insights director at retail analyst TCC Global.

“Do they really need as much toilet paper and other commodity categories? People shop elsewhere for that”

Bryan Roberts, TCC Global

He adds: “They have become a destination for events like BBQs and Christmas. That core chilled offering is where they lead the way.”

He feels the “rest” in need of modernisation is ambient. “Do they really need as much toilet paper and other commodity categories? People shop elsewhere for that,” he says.

Roberts says M&S’ woes are less to do with its own failures than the competition catching up.

“M&S has maintained an impressive rate of innovation and has been pioneering world foods like Korean and American BBQ. The big miss for me is the slow uptake of meat-free and vegan. It’s surprising as they’re usually ahead of the curve,” he says.

Roberts also believes the appointment of Wright could shake up the supply side and allow M&S to offer better value for customers.

Stores and pricing

Veteran analyst Nick Bubb says one of M&S’ issues is that the stores have become “ubiquitous” and are popping up at “every petrol station and every railway station”.

Store interiors, he says, are too clinical and intimidating and could benefit from a more welcoming interior, the kind implemented by Whole Foods Market, for example.

He also thinks that M&S is adrift on pricing and notes that innovations such as the £10 dine-in meals for two have been widely copied by supermarket rivals.

“M&S would say it’s being inventive but so is the competition”

Nick Bubb, analyst

“M&S needs to keep having interesting food that’s well-promoted,” he says. “M&S would say it’s being inventive but so is the competition – Tesco Finest, Sainsbury’s Taste The Difference – everyone is doing premium and it’s hard to stand out.”

Bubb also agrees with M&S management that the company must get better at availability. “I’d rather see the existing range getting delivered rather than management being changed again,” he added.“They must redouble their efforts – it’s not impossible to turn it around.”

Clive Black, of Shore Capital, is cautiously optimistic about the fresh appointments. “A precondition of success is the right people in place,” he says. “Time will judge if they are the people to stabilise and set a sustainable growth trajectory.

“What is most disappointing is the proposition became complicated and a bit out of touch with the substance of the market”

Clive Black, Shore Capital

“What is most disappointing is the proposition became complicated and a bit out of touch with the substance of the market. Accordingly, they’ve lost touch with the customer base.

 “To me it’s not a broken proposition from a structural point of view. It needs to have a high level of innovation and a high level of sophistication.

 “Changes are being made and they have to continue with improving trading performance.”

While M&S has made mis-steps and rivals have closed the gap on its premium food offering, the food division is well-placed to capitalise on its still enviable market position – with the right people at the helm.

Can M&S' new food dream team reverse ailing sales?