Marks & Spencer will increase its spending on supply
chain and technology despite a massive reduction in overall capital
expenditure and afall
in profit.
M&S made £706.2m in the year to 31 March 2009, compared with
over £1bn in the same period the previous year. The retailer
reduced overall capital expenditure to £652m in the 12 months ended
31 March 2009, compared with more than £1bn the previous year.
Spending on supply chain and technology increased from £162m the
previous year to £188m.
The company's overall capital expenditure will be less this
year, at £400m, but technology is set to take up a larger
proportion of a shrinking budget.
The retailer will
increase its investment in IT despite reducing its overall
spending. To do this the company will reduce spending on property.
"We will spend £400m [this year], shifting the focus of our capital
expenditure from our property portfolio, where we have made
considerable investment over the past three years, to our IT and
supply chain infrastructure."
IT spending is usually the first victim of budget cuts during a
downturn, but businesses
that continue to invest will benefit in the future.
The increased technology spending is part of a programme, known
as "2020 Doing the Right Thing", which will focus on changes in
operations, new avenues to market, international developments and
brand communication.
M&S chairman Sir Stuart Rose said the retailer's board has
reviewed the entire business. "This confirmed our long-term growth
plans [and] highlighted the need to deliver a step change in the
way we service our customers' needs and operate our business," he
said.
In January, M&S
revealed it would be shutting 27 stores and shedding 1,200
jobs.