Marks & Spencer is to review its 668-store portfolio to take account of the rise of online retail and said the scale of recent space expansion will not be repeated.

Speaking at the retailer’s investor day on Tuesday, finance and operations director Ian Dyson said that he envisaged store churn rather than closures.

A multichannel push was a key theme of the day and Dyson acknowledged the industry’s changing dynamics. He said: “Online and multichannel will have a squeeze on property-based sales.
“We will do a full review of our portfolio: where it is, its function - and that may change over time. That’s something we’ve not yet done.”

Marks & Spencer, which was slow to move onto retail parks, will focus on ensuring its stores are as well located as possible and play their part in a multichannel offer. Dyson said: “It’s a fair assumption that what we’ve had over the past few years you probably won’t see repeated, that sort of 4% to 5% space growth.”

Director of retail and M&S Direct Steve Rowe said multichannel was the biggest shift in shopping habits since the debut of self-service in the 1970s. On Monday, M&S relaunched its website and extended its Shop Your Way service - including home delivery or collect in-store options - from 46 to 163 locations.

Investec analyst Katharine Wynne said M&S “concedes the channel shift into online may leave stores unviable over time”.

Credit Suisse analyst Tony Shiret said that anticipated flat same-store sales in coming years will mean “material” space reorganisation and or rationalisation. He added: “Clearly the aim of having a multichannel offer is going to be a minimum requirement in the medium term - M&S cannot be faulted for moving toward this.”

M&S has overhauled 80% of its space in recent years, but still has unmodernised shops in some secondary towns that rival retailers believe are only marginally profitable and would be candidates for relocation or potential closure.