London, November 12, 2025 — Marks & Spencer (M&S) is overhauling its “factory to floor” supply chain as part of an ambitious strategy to double online non-food sales to nearly £3 billion ($4 billion) annually, the retailer’s new fashion, home, and beauty chief said in an exclusive Reuters interview.
John Lyttle, who joined M&S in March 2025 as Managing Director of Fashion, Home & Beauty (FH&B), outlined the retailer’s plans to modernize operations, increase efficiency, and leverage digital channels following a cyberattack in April that temporarily paralyzed online sales and caused an estimated £300 million in lost profit.
Strengthening M&S’ Market Position
Over the past three years, M&S has rebuilt its value, quality, and style credentials, with FH&B sales rising 9% and market share increasing to 10.5% in 2024/25, up from 9.1% in 2021/22.
Lyttle emphasized the importance of becoming a truly omnichannel retailer, integrating manufacturing, warehousing, and distribution to seamlessly serve both online and in-store customers.
“From where we make our goods to how we flow them into our warehouses, operate those facilities, and distribute to customers — whether online or in stores — we are rethinking every step,” Lyttle said.
The retailer is also streamlining the supply chain to cut costs and reduce complexity, a priority for many companies in the wake of COVID-19, geopolitical disruptions, shipping bottlenecks, and U.S. tariffs.
Long-Term Supplier Partnerships
M&S sources products primarily from China, Bangladesh, India, Pakistan, Vietnam, Cambodia, Sri Lanka, and Turkey. The company aims to forge longer-term supplier partnerships to minimize supply chain risks and unlock higher margins.
“We see significant opportunities to reset how we buy, increase cost discipline, and reduce complexity,” Lyttle said.
Targeting Online Growth
The retailer aims to increase online sales for FH&B from £1.4 billion in 2024/25 to nearly £3 billion long-term, while boosting online operating margins into double digits. Online sales currently account for about 34% of FH&B revenue, with a goal of reaching 50% in the medium term.
M&S faces a competitive gap in online penetration. Retail peer Next (NXT.L), an early adopter of warehouse and distribution automation, generates roughly 59% of its UK sales online.
Lyttle outlined several strategies to capture this growth:
- Optimizing product breadth and depth
- Expanding click and collect and return services through M&S’ 1,000+ stores
- Introducing additional payment options
- Relaunching the Sparks loyalty program to drive more frequent purchases
Investment in Automation
M&S has committed £120 million over three years to automate warehouses, increase capacity, and reduce complexity, delivering multi-million-pound cost savings.
Overall capital expenditure for 2025/26 is £600–650 million, with £200–250 million earmarked for technology infrastructure, store upgrades, and logistics fleet enhancements.
At the Castle Donington warehouse in central England, robotic technology will accelerate parcel sorting for click and collect, extending next-day delivery cut-off times to nearly midnight. Similar investments at Castle Donington and Bradford will increase boxed storage capacity by over 30%.
A new planning and merchandising platform is already automating tasks previously handled manually, improving efficiency across the supply chain. Lyttle emphasized that automation will complement, not replace, M&S’ 63,000-strong workforce.
Lessons from the Cyberattack
While the April cyber hack temporarily disrupted operations, it did not alter M&S’ long-term strategy. Lyttle noted that lessons from the incident will help improve speed and resilience, without disclosing sensitive operational details.
“It’s about learning what we could have done better or faster — not giving insight to those who impacted us,” Lyttle said.
Outlook
With a customer base of 21 million, M&S’ supply chain modernization and focus on omnichannel growth position the retailer to double online FH&B sales, improve margins, and remain competitive in the fast-evolving UK retail market.
The combination of automation, logistics optimization, and digital innovation is central to M&S’ vision of seamlessly connecting its stores, warehouses, and online platforms, delivering a stronger shopping experience for customers while driving long-term profitability.
Leave a Reply