Marks & Spencer Group Plc, the U.K. clothing retailer and grocer, is seeking store locations in Tokyo as part of a plan to accelerate growth in Asia to offset sluggish growth at home.
Australia, Taiwan and Vietnam are also under consideration as new markets, Bruce Findlay, the London-based company’s Asia chief, said in an interview yesterday.
“Japan is always on our radar,” said Findlay, who joined Marks & Spencer in September after stints at Calvin Klein, Tommy Hilfiger and Gap Inc. “I’ll be going there later this year to look at locations and opportunities. We think it’s going to be an instant success with food.”
Asia is among regions that Chief Executive Officer Marc Bolland is targeting as he seeks to revive sales after years of stagnation at home. Marks & Spencer got 11 percent of sales from outside the U.K. in the 12 months through March. Overseas revenue rose at more than twice the pace of the U.K. over the past five quarters, according to data compiled by Bloomberg.
Marks & Spencer intends to add at least 30 stores in Asia this year, part of the 250 it plans internationally over three years. Of those, 15 will be in India’s smaller cities beyond Mumbai, Delhi and Bangalore, and two in the Chinese city of Macau, the world’s largest casino gambling hub. The retailer has more than 140 stores across Asia including China, Hong Kong, India, Singapore, South Korea and Thailand.
Findlay is seeking to surpass last year’s 16 percent sales growth in the region in the current 12-month period, and expects revenue in India to increase 45 percent, more than last year’s 42 percent, he said.
“We need to beat what we did last year,” Findlay said. The Asian economy “could be challenging,” particularly in light of a May 22 coup in Thailand, he said.
Marks & Spencer opened 22 stores in Asia in the last financial year, focusing on the priority markets of China and India, the world’s two most most-populous countries.
The retailer is seeking a partner in China, following U.K. competitor Tesco Plc’s footstep in creating a partnership in the world’s second-largest economy. Tesco formed an alliance in 2013 with China Resources Enterprise Ltd. to combine hypermarket operations in the country.
Marks & Spencer will seek to hold a majority stake in any Chinese partnership, according to Findlay.
In India, the U.K. retailer has said it plans to double store numbers to 80 by 2016 and expand its lingerie offering, making the Asian nation its largest international market. It formed a venture in 2008 with Reliance Retail, controlled by the country’s richest man Mukesh Ambani.
Marks & Spencer opened its first standalone outlet for women’s lingerie in India this year. It will consider doing the same in Hong Kong and Singapore, according to Findlay.
The company has been relying on food for growth as it failed to stem the decline in clothing business,
Food made up almost half of the company’s sales in the year ended March, compared with 40 percent in general merchandise, a division that mostly comprises clothing.