There is no disputing that Marks & Spencer oozes Britishness. And despite its financial troubles in recent years, few would dispute the retailer retained consumer trust. But now that it is so triumphantly back on track, how far can that trust stretch?
That is the question M&S chief executive Stuart Rose and his board have been asking themselves. Judging by Rose's comments at M&S's prelims, it's a lot further. "This is a hugely under-potentialised brand. There is no limit to what we can sell," he claims. "The best is yet to come and we have a great opportunity to drive the business forward.
"Customers trust us to find things, so why shouldn't we sell other things? We had never sold a TV eight weeks ago, but now we've sold hundreds."
It was revealed in October last year that M&S was trialling electronics and, more importantly, non-M&S-branded goods to bring the retailer more into line with the supermarkets' cross-category offer, as well as department stores. Furniture-only stores, in-store restaurants, delis and hot food to go offers are now being trialled.
The retailer this week reported first quarter like for likes in food up 4.7%. Pre-tax profit for the group's first half rocketed 32% to £401.5m.
Rose says a department store may be a long way off. But he can foresee 10% of sales coming from products it does not currently stock. "That would be £800m but I can see £1bn of sales there."
There were no announcements about what brand new categories could be launched but he hints that by its end of year results next May there will be more to talk about. "Customers say they like the brand; they like the values and the shops," he says. "Opportunities to stretch our brand into new products and services and to broaden the business across new channels and overseas are now being pursued."
The constraint is floorspace. Rose's answer to this is the most ambitious expansion since the 1990s. It has undertaken a complete review of its property portfolio. "The key objective is to ensure we are in the right place with the right space. We have one of the strongest and most recognised brands in the UK, which needs a powerful showcase."
Rose believes M&S has been under-represented in retail parks, while the high street has also been neglected in places. Major work is under way at its flagship stores, including Liverpool and Edinburgh, on refurbs "that should have been done five years ago".
The Simply Food roll out is also accelerating, with Rose planning more than 400 stores. The format is working for M&S, with its Moto service station franchise also undergoing expansion. And it is also rolling out its trial with BP Connect forecourts to 200 locations. Over the next five years, Rose says he plans to grow its food space by 20-25%.
One concern is that with all the brand stretching, the M&S brand could become diluted and lose its value. Not so, says Shore Capital analyst John Stevenson. "As long as it can deliver critical mass, which Stuart Rose says is around £100m for any sub-brand, and everything justifies its space, then it is credible. M&S carries a lot of consumer trust and if these areas drive footfall, fabulous."
This week's results reveal Rose "has done very well", says Seymour Pierce analyst Richard Ratner. But Rose is not yet using the word 'recovery'. "I'm being superstitious," says Rose. "There are still seven weeks until Christmas. Prudence would dictate it is better to wait until 9 January. Then I may mutter the 'R' word."
That is the question M&S chief executive Stuart Rose and his board have been asking themselves. Judging by Rose's comments at M&S's prelims, it's a lot further. "This is a hugely under-potentialised brand. There is no limit to what we can sell," he claims. "The best is yet to come and we have a great opportunity to drive the business forward.
"Customers trust us to find things, so why shouldn't we sell other things? We had never sold a TV eight weeks ago, but now we've sold hundreds."
It was revealed in October last year that M&S was trialling electronics and, more importantly, non-M&S-branded goods to bring the retailer more into line with the supermarkets' cross-category offer, as well as department stores. Furniture-only stores, in-store restaurants, delis and hot food to go offers are now being trialled.
The retailer this week reported first quarter like for likes in food up 4.7%. Pre-tax profit for the group's first half rocketed 32% to £401.5m.
Rose says a department store may be a long way off. But he can foresee 10% of sales coming from products it does not currently stock. "That would be £800m but I can see £1bn of sales there."
There were no announcements about what brand new categories could be launched but he hints that by its end of year results next May there will be more to talk about. "Customers say they like the brand; they like the values and the shops," he says. "Opportunities to stretch our brand into new products and services and to broaden the business across new channels and overseas are now being pursued."
The constraint is floorspace. Rose's answer to this is the most ambitious expansion since the 1990s. It has undertaken a complete review of its property portfolio. "The key objective is to ensure we are in the right place with the right space. We have one of the strongest and most recognised brands in the UK, which needs a powerful showcase."
Rose believes M&S has been under-represented in retail parks, while the high street has also been neglected in places. Major work is under way at its flagship stores, including Liverpool and Edinburgh, on refurbs "that should have been done five years ago".
The Simply Food roll out is also accelerating, with Rose planning more than 400 stores. The format is working for M&S, with its Moto service station franchise also undergoing expansion. And it is also rolling out its trial with BP Connect forecourts to 200 locations. Over the next five years, Rose says he plans to grow its food space by 20-25%.
One concern is that with all the brand stretching, the M&S brand could become diluted and lose its value. Not so, says Shore Capital analyst John Stevenson. "As long as it can deliver critical mass, which Stuart Rose says is around £100m for any sub-brand, and everything justifies its space, then it is credible. M&S carries a lot of consumer trust and if these areas drive footfall, fabulous."
This week's results reveal Rose "has done very well", says Seymour Pierce analyst Richard Ratner. But Rose is not yet using the word 'recovery'. "I'm being superstitious," says Rose. "There are still seven weeks until Christmas. Prudence would dictate it is better to wait until 9 January. Then I may mutter the 'R' word."
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