In the wake of disastrous annual trading results, British chainstore Marks & Spencer last week insisted the company's performance in Ireland remained buoyant.
Earlier this month, the retail multiple - which last year opened a £22 million outlet in Dublin's Liffey Valley shopping centre - announced a net loss for the first time in many years, with chief executive Peter Salsbury placing the blame on a "catalogue of problems".
Marks & Spencer had issued a profit warning in January but the results still caused consternation; the company reported pre-tax profits of £546 million sterling (compared to £1.15 billion a year earlier) but, after taking tax and dividends into account, this translates into a deficit of £41 million. In Ireland, however, Marks & Spencer's general manager, Stephen Costello said that while the stores here had shared certain problems with their British counterparts, overall he was very happy with the past year's results.
The company's Irish operation is separate from that in Britain but in financial terms is included in the rest of M & S's European business. Although no separate figures were released for this country, "it performed substantially better than the British operation did".
The last financial year saw "our biggest development in Ireland ever; we increased floor-space by 60-odd per cent and so attracted a much wider customer base here. The difference is that the Irish market is a growing one, whereas it's static in Britain." However, he acknowledged that some of the difficulties which arose in British outlets also occurred in this country. Marks & Spencer's clothing sales performed particularly poorly last autumn/ winter. The company invested heavily in grey, the high-fashion colour for the season, and this was largely rejected by customers - leading to large amounts of clothing being left on the shelves. Furthermore, Marks & Spencer appeared to have lost the loyalty of its traditional market without picking up new consumers.
"Our stocking problems were less dramatic than the UK, again because this is a growing market," Mr Costello commented, "but we did get an abundance of feedback from customers saying they didn't like grey and black. Part of our difficulty is that we are serving a mass market but I think everyone on the high street had difficulty saying what the season's style was." Describing the Irish consumer as "equally, if not more, discerning than his or her British equivalent", Mr Costello said greater awareness of the market had meant Marks & Spencer's performance in this country during the present year had been "pretty strong - stronger than the UK. Personally, I think Ireland is a very sophisticated retailing market and very competitive; it's quite clear where different retailers sit in a well-defined market". The company is now putting into place new supply systems, which will allow it to respond faster and more effectively to consumer trends. According to Mr Costello, products manufactured overseas will now be transported by air rather than sea, thereby speeding up re-stocking operations.
IN addition, "we will be a lot more focused on getting to customers what they want; for example, we will be dyeing T-shirts later in the season, so that if a particular colour is popular, we will be able to supply it".
Marks & Spencer now has about 300,000 sq ft in Ireland. In addition to the Liffey Valley outlet, last year the company also expanded its Mary Street branch in Dublin at a cost of £16 million. Marks & Spencer has expressed interest in opening outlets in both Limerick and Galway, as well as additional branches in the capital.
"There's nothing we're about to sign off," said Stephen Costello, "but we're always keeping an eye on the ball in terms of alternative locations."
