It’s been in the news a lot over the last week that Marks & Spencer is going to be closing a many of its stores or converting them to food-only outlets due to poor sales.
M&S has not identified which stores will close, but that hasn’t stopped the Daily Mail – that well-known xenophobic, right-wing publication – producing a list of its own, and frightening the hell out of M&S employees pretty much in every location throughout the country. And right before Christmas. Twats.
But it got me thinking about something I’ve discussed with a lot of my pupils over the last few years. If M&S is seen as having “too many stores” in some cities (that’s the official analysts’ view – there are 12 in Nottinghamshire), are the likes of Lidl and Aldi likely to come unstuck in the future as they continue their aggressive expansion policies in the UK? I mean, if you just look at overall sales per customer, and don’t consider the actual store they shop in, how can Lidl, Aldi, M&S, Co-op, Tesco, Morrison’s, and so on possibly succeed in locations where ALL of those names have stores virtually next door to each other?
Even when comparing like for like, Aldi has 16 stores in Nottinghamshire – with several further sites earmarked for development. Lidl has 10, and quite possibly other sites in the pipeline.
At Netherfield, for example, there is a Lidl, a Morrison’s, and an M&S Food Hall all within a 250m radius. Less than a mile away there is a Tesco superstore, and at least one small Sainsbury’s. Sainsbury’s are about to build a superstore right next to Morrison’s in this same location. You don’t need to be a genius to realise that being the ONLY food store is likely to produce a bigger turnover than being one of half a dozen or more all serving in the same catchment area.
The Co-op has problems which are unique to it, It has been in financial difficulties for pretty much the whole of the last decade, and it has closed numerous stores. But it has also built many others. One of the best examples of the apparent incompetent management style responsible for it’s dire financial situation can be seen in Clifton. The Co-op used to occupy a large unit on Varney Road (the “bottom shops”, as the location is sometimes called). A few years ago – in the middle of it’s near collapse – it closed this store, only to reopen on the site of the former petrol station on Farnborough Road a few months later. The new, purpose-built store is only a few hundred metres away from the original location, which is now operated as a Mace store. The two were approximately similar in terms of floor area.
M&S is accused of having too many stores – and its bubble is about to burst. The Co-op is frantically pumping air into one end of its bubble, while it gushes out at the other. So what logic should we apply to Aldi and Lidl who are currently inflating their own bubbles so that they’re bigger than anyone else’s – right next to those others?