Keener prices are likely to play a role in new M&S boss Steve Rowe’s drive to turn around performance at the retailer’s clothing division.

Marks & Spencer cut prices of about 300 lines earlier this year and was pleased with the results.

Rowe, who took over as M&S chief executive last weekend and was formerly general merchandise director, will now look at how best to balance pricing, promotions and margin to be as competitive as possible.

M&S suffered a 2.7% fall in like-for-like sales of clothing and home products in its fourth quarter.

The decline was not as bad as had been feared by City analysts, who had pencilled in a fall of between 3% and 4%.

Rowe said: “Let me be very clear. This performance was not good enough.”

He would not be drawn on his strategic plans for M&S, which he will outline alongside full-year results in May.

However, he said: “We’ve got a lot more to do on clothing. We’ve started to improve our value proposition. I’m personally committed to getting fashion right, it’s the number one priority of the business.”

Rowe “sharpened” prices earlier this year on its core promoted spring womenswear collection, and cut prices of products such as jeggings by about 10%. There were also similar reductions on some menswear lines.

M&S still delivered “a strong gross margin improvement” and reined in promotions.

Rowe said: “It’s the start of a programme where we’re looking at the balance between pricing, promotions and margin.

“It’s not a straightforward line between reduction in price and reduction in margin. There are tunes you can play.”

He said some of the product volumes had risen “substantially”, which benefits margin.

Between now and the May results Rowe and his team will continue to look at all aspects of the business and he said he is “open-minded to everything”.