17 December 2008
Updated: Marks & Spencer's sales fell of a cliff last week as core categories slumped by as much as 30 per cent, it is understood.
Retail industry and City sources told Retail Week the declines ranged between 20 per cent and as high as 30 per cent, and womenswear was worst hit.
The sales slump came as Marks & Spencer failed to repeat the one-day 20 per cent-off spectaculars of the previous fortnight, preferring instead to introduce a raft of alternative pre-Christmas promotions.
Pali International analyst Nick Bubb issued a note this morning saying Marks & Spencer's sales last week were down between 20 and 25 per cent. He cut his full-year profit forecast by seven per cent from £640 million to £599 million.
Bubb said: "However successful the two 20 per cent off everything one-day Sales were, it looks as if they simply pulled business forward and undermined consumer trust in the brand.
"With Debenhams upping the promotional ante again this week with more "Up to 50 per cent off" discounts, M&S's hand may be forced and they may have to have another one-day Sale again pre-Christmas, which would destroy what's left of their pricing power."
Marks & Spencer, which is in a closed period, declined to comment. The retailer updates on trading on January 7.
More pre-Christmas promotions
Marks & Spencer has unveiled another round of pre-Christmas promotions.
From Thursday until Christmas Eve, all men's and women's knitwear will be reduced by 30 per cent, including the Autograph, Limited Collection and Collezione ranges; 30 per cent off all sleepwear and 30 per cent off Autograph and Ceriso lingerie.
In food, selected champagne and smoked salmon will be offered at half-price, there will be 33 per cent reductions on selected beef and lamb joints and four-for-three deals on all party food.
Marks & Spencer executive chairman Sir Stuart Rose said: "We know there are lots of people looking for last-minute gifts in the countdown for Christmas, so we've got perfect solutions for all the family."