Sir Stuart Rose’s Plan A envisioned a glorious green future for Britain’s most famous retailer.

The strategy to be unveiled next week by Marc Bolland, Sir Stuart’s successor as chief executive of Marks and Spencer, will be a more conventional corporate Plan A: improve the efficiency of capital spending, drive geographic expansion, and capture some of the ground lost to rivals in internet and homeware retailing.

Mr Bolland’s blueprint for driving M&S forward need not be any more complicated than that. Expect to see the phrase ‘evolution, not revolution’ peppering his PowerPoint presentation – and not only to vindicate Sir Stuart.

That philosophy will be demonstrated as much by what the silky-smooth Dutchman does not say as by what he does.

Analysts looking for evidence, for example, of a widespread cull of M&S clothing brands or a return to some of the shops sold during M&S’s retrenchment a decade ago, will be disappointed.

What he will say, though, will be redolent of a sensible – and measured – post-Rose-era journey. Reinvigorating the company’s international footprint will be on the agenda. Mr Bolland, a former Heineken executive, will be anxious to explore the fast-growing regions of China and India that his predecessors could not reach.

I am also led to believe that he will outline plans to double M&S’s annual online sales target to about £1bn, underlining the prevailing view in the City that the company must aggressively expand its internet operations if it is to be regarded as a genuine multichannel retailer.

The principle of evolutionary change will be highlighted most tangibly in M&S’s clothing business, where Mr Bolland will point to a streamlining (as opposed to a slashing and burning) of the portfolio of fashion brands.

Similarly, he is likely to say that the decision to sell branded foods has been sufficiently successful to justify expanding the number of participating stores.

The M&S chief will also say that the homewares market remains a largely untapped opportunity – although investors prone to breaking into a sweat over memories of Roger Holmes’ ghastly Lifestore in 2004 need not fear a repeat performance.

That will not be the only thing setting Mr Bolland apart from his predecessors. He may be the first M&S boss in recent memory who does not need to devote attention to gripes about corporate governance. That may be a modest relative advantage, but it is one that Mr Bolland should embrace.

Coventry no bad place

Ron Sandler, the chairman of Northern Rock, obviously has a sense of humour. During negotiations about the departure of Gary Hoffman, the state-owned bank’s chief executive, he gave the discussions the code name Coventry.

In one respect, Mr Hoffman has been sent there. A restriction on his new employer, NBNK Investments, mounting a bid for Northern Rock within the next year is potentially problematic for a venture whose raison d’être is to acquire high street banking assets.

The development increases the pressure on NBNK to buy about 600 Lloyds Banking Group branches, which must be sold by the end of 2013. Other businesses of similar scale are in short supply.

Either way, Mr Hoffman is not going to become impoverished by his attempt to build a new force in retail banking, despite having relinquished his entitlement to six months’ pay and pension contributions.

I understand that he will receive a £1.6m ‘golden hello’ to compensate him for the loss of performance-related earnings at Northern Rock. He will also earn a similar annual sum to his £700,000 salary at the government-owned bank.

The real prize, though, will be a substantial equity-based package, which could make him tens of millions of pounds over a five-year period. Mr Hoffman, who surrendered his Northern Rock bonus for two years running amid political pressure, looks to have played a smart hand.

If NBNK fails to do a deal, his record means he is unlikely to struggle to secure another job; and if it succeeds, he may find himself in a highly unorthodox position for a banker – making pots of money and being praised by competition-hungry government ministers.

Triumphalism misplaced

On the face of it, the flurry of announcements in the coming days from Arup, BT and Standard Life would indicate that Anglo-Chinese trade is booming.

Next week’s business delegation will be the largest taken by a prime minister to China. Many will be old hands there; others, such as Northgate, the IT service provider, will be doing their first business in the country.

Any sense of triumphalism about these deals would be misplaced. Timed as they are to coincide with David Cameron’s presence in Beijing, their neat choreography should not mask the fact that Britain’s trade with the Bric countries remains in aggregate smaller than that it conducts with Ireland.

That sorry statistic reflects the reality that Britain’s trade strategy has been too fragmented and overly dependent on exploiting the global influence of the City.

The government’s trade white paper, due to be published in January, should be a wake-up call to those who mistake next week’s glad-handing in China for a credible long-term plan.

Mark Kleinman is City editor of Sky News and writes a blog at

Get alerts on UK companies when a new story is published

Copyright The Financial Times Limited 2019. All rights reserved.
Reuse this content (opens in new window)

Comments have not been enabled for this article.

Follow the topics in this article