Building a more international company

Our international strategy is built around a clear geographic focus, supported by the right business model for each market. We are growing our presence in India, China and the Middle East region including Russia and Turkey, as well as developing a multi-channel proposition to serve customers in Western Europe. This approach is being delivered by a best-in-class international management team, comprising high calibre external talent, M&S experience and valuable local expertise.

We began work to improve our international buying processes – combining our central planning with local market knowledge to deliver a more tailored product offer that better reflects local seasonality, culture and customer profile. Supply chain improvements are enabling us to deliver product to our international stores more efficiently. We trialled a new approach to product cataloguing across our 46 Czech stores, developing a clear customer profile for each store and adapting the product range accordingly. We’re extending the use of this model to more stores.

Our specialist visual merchandising team, combined with the roll-out of our new store format to selected international stores, is helping us deliver a more aspirational and consistent store environment for international customers. This has been further supported through the provision of additional marketing support and visual merchandising guidance to our franchise partners.

Regional focus

In Asia, we focused on driving growth in our priority territories of India and China and delivered a sales growth of 13%. With our partners Reliance Retail, we opened six new stores in India and we continued to grow our presence in Shanghai, with the opening of seven new stores. We now have a total of 14 stores in the Shanghai region including our new flagship store at Golden Bell Plaza. Our Hong Kong operations also performed strongly and we opened a new store in the New Territories in January.

Our franchise operations across key territories in the Middle East performed well, with sales up 9.7%. We opened 19 new stores across 11 territories, including new markets such as Georgia, Kazakhstan and Armenia. We enhanced our offer in existing markets, introducing the new store format to our flagship Bagdat store in Turkey.

Our European business was impacted by the ongoing weakness of the Irish and Greek economies and sales were down 0.4%. Sales in the Czech Republic strengthened as the business responded well to the management and structural changes put in place last year.

Our first full line French store opened in October at So Ouest in Levallois-Perret, Paris and attracted over 80,000 customers in its first three days of trading.

Multi-channel expansion

Our ‘bricks and clicks’ strategy combines international store openings with website launches and the latest digital technologies. This approach enables us to extend the reach of the M&S brand in both new and existing markets, as well as tailoring our offer to local customers’ shopping preferences.

In May 2012 we shared plans to trade in ten markets by the end of the financial year. Following the successful launch of our local French and Irish websites, we made significant progress, with the launch of a further six fully localised European websites by April 2013.

In addition to our European e-commerce offer, we are working closely with international partners to benefit from their local infrastructure and expertise to help us explore the growth opportunities in more complex e-commerce markets. In January we launched an online shop on China’s leading retail website TMall and in February, we announced plans to launch an e-commerce offer for the Russian market, operated by our existing franchise partner Fiba.