LONDON - Marks and Spencer, a bellwether for the retail industry, plans to reduce its marketing budget by 20% this year and make 1,230 staff redundant as part of £175m to £200m cost cutting initiative following one of its worst Christmas trading performances on record.
The retailer reported today that like-for-like sales in the UK were down 7.1% in the 13 weeks to 27 December 2008. Sales for general merchandise, including clothing dropped by 8.2% and food fell by 5.2%. Online sales proved more resilient, with record traffic driving sales up 29%.
It is proposing to cut up to 450 jobs in its head office, which would be around 15% of its head office staff and to close 27 underperforming stores, which will lead to a further 780 job losses.
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