M&S is looking to reset its prices in its overseas stores in a bid to turn around a slowdown in its international business.
Chief executive Stuart Machin said the firm planned to “restore the competitiveness” of the company overseas and added that it was “way out of kilter on price”, The Sunday Telegraph reported.
Despite remarkable growth in its domestic arm, overseas sales have been faltering at M&S. In the third quarter of this year, international sales fell 10.3 per cent, and international adjusted operating profit halved to £15.2m.
Machin has suggested that overseas prices have risen because both M&S and its franchise partners make a margin on sales.
“The truth is, there is no win-win partnership with our franchise partners … We need to re-contract with those partners and reset the expectations,” Machin said speaking at an investor day earlier this month. “We have to completely rethink international.”
Marks and Spencer has 434 international stores compared to 1,058 UK stores, with more than half of its international stores run by franchise partners.
In a statement alongside Marks and Spencer’s third-quarter results earlier this year, Machin said that Marks and Spencer was “resetting priorities in international to drive future growth” and “acting now to improve short-term performance.”
The company said an international reset was “underway”, with a new leadership team in place.
It said that “actions have been taken” to lower stock levels, improve the range, reduce operating costs and strengthen leadership, and it expects the business to stabilise in the next year.
Further changes may include making supply chains more efficient and trialling new products in international markets, The Sunday Telegraph report said.
City AM contacted Marks and Spencer for comment.