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Sandy Li

UK retail icon sees strong business even after being booted out of Pacific Place

British retailer Marks & Spencer is seeking a new site in Hong Kong after its flagship store  at Pacific Place in Admiralty closed  on Friday and has identified Macau as its next possible expansion target.

The  firm refused to say whether the closure of its 15-year-old Pacific Place outlet, one of its best-performing  shops in Hong Kong, would  hurt  its Asian operations.

The Hong Kong operation is the group's only wholly owned subsidiary in Asia.  Stores in Singapore, Indonesia, the Philippines, South Korea and Thailand are operated through franchises.

Two months ago, Marks & Spencer said in London its sales for the 13 weeks to April dropped 4.9 per cent, the sixth consecutive quarter of falling sales.

'The Pacific Place store is important to us. But even if we do not have it, we will continue to have a strong and profitable business,' Marks & Spencer Asia-Pacific managing director Gill Morton said, adding the chain still had eight stores in Hong Kong.

Last year, the retailer suffered a setback  when Pacific Place landlord Swire Properties decided not to renew its lease, even though Marks & Spencer was willing to pay higher rents.

The shopping centre said it wanted to alter its trade mix.

Half of the 24,000 square  feet occupied by Marks & Spencer in Pacific Place will be taken by trendy fashion retailer Zara  while  several other brands will  lease the rest.

'We are actively looking for a new store and we'd love to able to grow the number of stores in the right locations,' Ms Morton said.

At the same time, Marks & Spencer was  looking closely at Macau,  which  was transforming into a leisure and entertainment destination for holidaymakers,  she said. 'But [there is] no firm plan at the moment.'

Faced with intensifying competition in the retail market  and struggling with the fading appeal of the M&S brand, especially among young customers, the British  apparel retailer started renovating its stores last year, beginning with outlets in Tsim Sha Tsui, Diamond Hill and Taikoo Shing.

Its  concept store in Times Square, Causeway Bay, reopened last week.

'We are committed to presenting an up-to-date image to our customers so we continue renovating our stores,'  Ms Morton said.

In addition, the group will open a sourcing centre in Hong Kong next month to sharpen its pricing competitiveness.

'The office will look after sourcing in China for our worldwide operations,' she said. 'Hopefully, it will provide quicker access to products with better prices.'

Obviously, Hong Kong would benefit from it,  Ms Morton said.

'Before, our sourcing was concentrated in London, but it made lots of sense to have an office closer to the area of production,' she said.

Other sourcing offices were to be opened in Turkey and Sri Lanka,  she said.

Meanwhile,  the group had also introduced new product lines to attract younger and more fashionable women, Ms Morton said.

'Our strategy is to continue giving customers what they want to come to Marks & Spencer for, and that is  quality and affordable prices in a pleasant shopping environment,' she said.



Marks & Spencer looks for new site, eyes Macau foray