Marks & Spencer has drafted in grocery industry heavyweight Justin King as the struggling retailer embarks on a fresh crusade to revive profits.
King, who said M&S held a “very special place” in his affections, is best known for his long stint at the helm of Sainsbury’s. Before that, the 57-year-old spent three years working for M&S running its £6bn-turnover food business.
The appointment of King as a non-executive director reunites the businessman with Archie Norman, who is a year into his chairmanship. The pair worked together on the successful turnaround of Asda in the 1990s.
Commenting on King’s appointment, Norman said: “Justin’s appointment completes a very significant reorientation of the board in the last year. He will be a great addition to a strong team.”
After a decade of failed reinventions, the 134-year-old M&S is now aiming for sustainable, profitable growth in three to five years by shutting less successful stores. When the chief executive, Steve Rowe, updated the City on first-half sales last month there was no good news, with declines in both clothing and food sales as, after several years of outperformance, the wheels also came off M&S’s Simply Food chain.
M&S said King, who joins the board on 1 January, was one of the pioneers of Simply Food: “He brings in-depth experience of retail transformation and operations as well as a good historic understanding of the M&S business and values.”
King is celebrated for his turnaround of Sainsbury’s; when he joined in 2004 it was a near basket case. One of his biggest headaches was an expensive new network of automated food depots that was unable to track stock properly. At the time the misfiring warehouses contributed to empty shelves and millions of pounds of lost or damaged stock.
M&S has also encountered teething problems as it attempts to overhaul its ageing logistics for an internet age. In 2013 it opened a state-of-the-art warehouse in Castle Donington, Leicestershire, but it turned out to be an over-engineered white elephant unable to support M&S ambitions to have 30% of its clothing sales online within five years.
Analysts suggested King’s experience at Sainsbury’s would increase scrutiny of Rowe, an M&S lifer, and the retailer’s new food managing director, Stuart Machin. They also speculated that, should Norman lose patience with either man, he would have a ready-made replacement, although Britain’s corporate governance guidelines advise against moving a non-executive director to an executive role.
King will continue as vice-chairman of Terra Firma, the private equity firm led by the tax exile Guy Hands which he joined in 2015. However, it was recently reported that he is stepping back from day-to-day management of the buyout group.
