LONDON (Reuters) - British retailer Marks & Spencer (MKS.L) has decided to close five stores in the greater Shanghai region following a review of its plans for China that will nevertheless see it stick to a commitment to expand into the country’s other large cities.
M&S also said on Monday that Bruce Findlay, its regional director for Asia, was quitting the firm after less than two years in the role to take up a position with another retailer.
The company entered China in 2008 with a store in Shanghai, and it now has 15 in the greater Shanghai region. But it has struggled to make a major impact in a country that it said on Monday remains one of its priority international markets along with India, Russia and the Middle East.
For the long term the group is in the process of evaluating potential local partners to expand in China, a path taken by other British retailers such as supermarkets group Tesco (TSCO.L) and home improvements firm Kingfisher (KGF.L).
Updating on its plans for the country following a review announced last April, M&S said it would continue to invest in its existing flagship store portfolio with the complete modernisation of its West Nanjing Road store in Shanghai in the autumn.
However, five of its supporting stores in the greater Shanghai region will close by August. Some 60 jobs will be effected. M&S also plans to reduce the size of its Shanghai head office.
M&S said it has a firm intent to enter other cities such as Beijing and Guangzhou over the next year, while further expansion online would enhance its brand across China.
The firm also plans to continue to invest in Hong Kong, where it currently has 18 wholly-owned stores and four standalone food stores, and expand in Macau.
M&S, hit in its home market by dwindling clothing sales, said last April it planned to expand its international stores by more than a half.
Shares in the firm were up 1 percent at 510 pence at 1620 GMT.
Reporting by James Davey; Editing by Louise Heavens and Greg Mahlich