Marks & Spencer to spend £450m on supply chain revamp


Marks & Spencer to spend £450m on supply chain revamp

Ian Grant

Marks & Spencer is to spend £450m over three years to revamp its supply chain and supporting IT systems, and aims to generate £500m in sales from its website.

The news was revealed by M&S chief executive Stuart Rose yesterday when he announced record sales for the British retailer.

Rose said the firm spent £150m this year revamping its IT systems; notably a new financial management system, its e-commerce venture with Amazon, and replacing tills and point of sale terminals, some of which are nine years old.

Finance director Ian Dyson said this level of spending was a significant step up for M&S and that he anticipates spending similar sums for the next two or three years.

The IT spend will support M&S’s moves to open new stores in the UK and overseas, to make its supply chain more efficient, and to manage its stock better. This includes new ordering systems for its distribution centres and stores.

Rose said 65% of online customers bought from M&S Direct, the firm’s digital shop, only once in 2006. He wants to convert many more of M&S’s 27 million regular customers to online shoppers.

He said sales at M&S Direct are already £180m a year, but he has hired director of e-commerce, John Dixon, to drive them to £500m as soon as possible.

Helping him in a non-executive director role will be founder Martha Lane Fox, who will spend 15 days a year at the firm.

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