Marks & Spencer was a 20th-century paradigm of better business: a trusted brand and a benign employer that built strong relationships with suppliers and generated handsome returns for shareholders. Then its performance began to fade, as one management team after another failed to keep pace with retail trends in-store and online. By August 2020, when it announced 7,000 job cuts and ‘multi-level consultation [on] further streamlining’, I was moved to predict M&S would end up as no more than ‘a chain of upmarket convenience food stores and a website that’s handy for sending flowers and chocolates’.
But I misjudged the residual loyalty of middle-class shoppers. Lately they have been returning in large numbers to increase M&S’s share of the womenswear and grocery markets – knocking spots off Waitrose in the latter sector. Stores refurbished as part of a major investment programme were reported to have performed particularly well over Christmas. If the trend is sustained, then M&S is back – and in a Britain otherwise falling apart in so many aspects, who could deny that’s uplifting news?
Kudos to chief executive Stuart Machin, who began as a teenage shelf-stacker at Sainsbury’s. But even more so to the master-mind of M&S’s revival, chairman Archie Norman – a veteran operator who previously ran Asda, ITV and the London arm of Lazard as well as commuting to Australia to rescue the Coles retail chain. It’s tempting to ask why people with Norman’s skills aren’t hired in Whitehall to run the country – but he had a crack at that, serving as a Tory MP and shadow minister for eight years before giving it up as a bad job. Companies can be wrestled into shape by bosses with determination; politics is a more slippery business.
Stamina rewarded
Speaking of veterans, the deal of the week was undoubtedly the takeover by BlackRock, the US investment giant, of Global Infrastructure Partners (GIL), a transatlantic business best known in the UK as the owner of Gatwick airport, but whose $106 billion of worldwide assets encompass ports, pipelines and green energy projects, including North Sea wind farms.
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