This is a man who, just a couple of months ago, was appointed to the main board of Marks & Spencer and touted as a frontrunner to succeed Sir Stuart Rose as chief executive. This week, he was clearing his desk, paying the price for the company’s appalling performance in food.
What makes the situation particularly embarrassing for the company is that no one in the industry ever seemed to share Rose’s view that Esom was a potential leader of M&S. Indeed, he even fell in this year’s Retail Week power list, despite his rapid ascent at the retailer, thanks to the constant negative vibes about him from pretty much everyone outside the Paddington bunker.
Rose this week tried to portray the poor performance as more of a market issue, rather than one of M&S’s making. In fashion he has a case, but in a food market where every other player is showing like-for-like growth – helped by significant levels of inflation – the 4.5 per cent decline revealed this week was dire and Esom had to go.
However, his departure won’t solve the underperformance in food, which predates Esom’s promotion to the board. Rose insists that the expensive refurb programme will go on and that the company will continue to roll out Simply Food stores, despite the mounting evidence that these units – which are invariably leasehold – are cannibalising sales from established freehold stores.
The gap between M&S’s fashion offer – now heavily skewed towards entry price points – and its food offer – where the high quality is often matched by eye-watering prices – has grown into a chasm. M&S’s food and fashion businesses have always served different markets, but the gap has widened too far. Rose needs to bring them closer together by upping the better and best ranges in fashion and competitiveness on food.
No one disputes that the market is hard, but well-run food businesses, from Waitrose to Aldi, are prospering despite the downturn. How successful new head of food John Dixon is in turning it around will tell us whether Esom was the issue or if the problems run deeper.
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