Marks & Spencer’s outgoing Executive Chairman Sir Stuart Rose has admitted the retailer was wrong to close its stores in Western Europe, The Times reported. Rose said the retailer had closed its stores across Europe for internal “political, not commercial” reasons. He said he would have reversed the decision if he had been at the helm at the time.
Between 2000 and 2001 Marks & Spencer closed a number of shops across Spain, France, Belgium, Germany, Luxembourg, Portugal and the Netherlands. In an interview with Spanish newspaper Cincodias, he said: “In 2001, we took the tragic decision to close all the (shops) in Europe. The reason was political, not commercial.” He added: “As we were going through a difficult time in Britain we decided to close [all the stores] to save our economic activity in the UK. We will be back at some time, but not in the foreseeable future.” He also said: “We began our European expansion in 1976. We got a large market share in Holland and in Belgium and had an important presence in Spain. We had a few problems in Germany but in general the European market was more than profitable.”
Rose cited China including Hong Kong as one of the retailer’s most important markets going forward. “In the ten major cities of the country, the [total] population is 60% more than the population of Britain. For this reason we have ten shops in Hong Kong and we will open a third later this year in Shanghai,” Rose said. Speaking on the economic downturn Rose said that while Marks & Spencer had been one of the first to be hit by the recession it had also been one of the first British businesses to recover. “The key has been not to get our strategy wrong at a time of crisis. Never did we feel the temptation to compromise the quality of what we are selling. We cut margins and prices and crossed our fingers.” Rose added that while sales had suffered, Marks & Spencer had invested GBP5 billion (USD8.11 billion) in revamping stores, online shopping and other parts of the business “so our customers continue believing in us.”
