After a difficult Christmas trading period and a tough year in general, Marks & Spencer is to close its London distribution centre in Neasdon, with up to 380 jobs in jeopardy.
As part of CEO Steve Rowe’s five-year turnaround plan, M&S will leave its Neasden site in north west London and transfer the work to other sites.
Rowe has presided over many changes at M&S, including a programme of shop closures and a withdrawal from some international markets.
M&S has a large portfolio of stores which is seen by many City watchers as a major headache facing the company in terms of costs, as it owns more shops than most of its retail rivals.
The number of stores might not in itself be a major concern if trading numbers had proved highly robust but a steep fall in clothing sales compounded by disappointing festive trading in its food halls has taken its toll.
Focus on value
With earnings stretched and pressure on UK living standards, M&S has struggled to attract cost-conscious shoppers.
In an effort to increase efficiency, M&s has confirmed it will open a large, new mechanised clothing and homeware logistics centre in Welham Green, Hertfordshire in 2019. The site is expected to serve 150 shops in the South East and be under the control of a third-party logistics supplier.
According to M&S, the Hertfordshire facility is part of a strategy to move to a "single-tier" logistics system, whereby stock transfers direct from one warehouse to stores, rather than passing through different supply chains, which often results in delays and insufficient items on high street shelves during peak shopping times.
M&S was marginally up in mid-morning trading - up 0.3% to 308.40.