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French Lament the Loss of Beloved M&S

Retail: Marks & Spencer, Britain's venerable department store, plans to shed its European and U.S. businesses to focus on its core market.

April 23, 2001|MARJORIE MILLER | TIMES STAFF WRITER

PARIS — Marks & Spencer's flagship emporium in France was shuttered against a lunch-hour union demonstration, and French shoppers waiting patiently on Boulevard Haussmann for the doors to open sang the praises of the British retailer's foods, sweaters and brassieres.

Brassieres? British lingerie in France?

"Oh yes, I buy all of my lingerie here," Marie Claire Basset, 62, said.

"Yes, yes, you have many sizes and choices, some of them are very stylish," said Nelly Carpentier, 24, on the verge of raising her T-shirt for a display.

If only Marks & Spencer's British customers were so enthusiastic.

After a century of brilliance and a profit of $1.75 billion in 1998, the fortunes of Britain's largest clothing retailer have plummeted. Profit is down by more than half, and the company said last month that it plans to shed its European and U.S. businesses to focus on its core British market.

The company's Brooks Brothers clothing chain and New Jersey-based King supermarkets are up for sale in the United States, and all 38 Marks & Spencer stores in continental Europe, including 18 in France, are to close at the end of the year.

"U.K. retail is 85% of turnover," said Louis Hill, a spokesman for Marks & Spencer in London. "It's central we get that right."

But even this effort to put things right has gone wrong. French labor unions challenged the planned closures in court, and a French judge ruled that Marks & Spencer broke the country's labor laws when it abruptly informed its 1,700 employees here that they would soon lose their jobs.

The judge ordered the company to undertake a consultation with its French staff, and French Prime Minister Lionel Jospin said his government intends to tighten labor laws to make it harder for profitable companies to fire workers.

French customers, meanwhile, have lodged their lamentations over the announced closure in more than 35 "condolence" books at Marks & Spencer stores, much like the ones that appeared when Princess Diana died in 1997.

"Cher Monsieur Vandevelde," a customer named Gisele wrote to the company's Belgian-born chief executive, Luc Vandevelde. "I think you should overturn your sad decision."

"Brits," added another named Nina, "please, do not leave us."

"What a shame, what a waste," many others penned as they came to stock up on English tea.

"One would be forgiven for thinking that the French flocked to this store," said Richard Hyman, chairman of Verdict, a retail consulting firm. "Had that been the case, Marks & Spencer would not be pulling out of France."

In fact, Hill said, losses in France alone were about $42 million last year. None of the French stores made a profit, not even the prime-location, 4,000-square-foot Boulevard Haussmann store, he said.

Hyman said Marks & Spencer's troubles are a mixture of "bad luck and bad judgment. They have become caught in a downward spiral of things going wrong, where you lose your confidence, become a bit wary and less sure of your judgment."

With humble origins in a Leeds, England, market stall, Michael Marks and Tom Spencer formed a partnership in 1894 that grew into a national chain of department stores as British as marmalade and as middle England as mince pie.

Generations of schoolchildren have been hauled into "Marks & Sparks" each year for their underwear, trousers and pullovers, as sweaters are called in Britain. Husbands bought their wives' birthday presents there, knowing of the store's generous return policy. And singles liked to do their one-stop Christmas shopping at M&S, preferably on Christmas Eve.

For these customers, the chain offered good quality for reasonable prices. The store stood for wholesomeness and dependability.

But with more money in their pockets in recent years and more choices from other stores in the last few years, Britons have grown tired of the tried and true. The British chains Next and Top Shop suddenly seemed to offer more fashionable clothes, along with Gap from the United States.

Sensible M&S suddenly seemed frumpy.

The company, which has about 180 stores in Britain, has struggled to respond with new board members, new designers, a new high-end line and a new chief executive in Vandevelde last year. But nothing has helped. Even a bold advertising campaign with a full-figured woman, meant to show that the store's clothes are for real people rather than supermodels, fell flat.

Profit fell to about $708 million last year, and a confidential, internal memo forecast fiscal-year profit of about $625 million. The same memo showed that return on capital invested by the company had dropped from 17.5% to 15.2%.

The leak came just days after the March 29 announcement of the closure of the European stores and elimination of more than 1,000 jobs in Britain. It was believed to have come from a member of senior staff, who have been told they won't receive bonuses this year, although Vandevelde will get a $940,000 bonus he negotiated before joining the company.

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