M&S e-commerce IT systems bolster Christmas revenues

Marks & Spencer has revealed that its M&S Direct online ordering service and Christmas Food to Order site played a key part in delivering the company with sales growth in the last quarter, as it invested heavily in IT.

As M&S overhauls its key supply chain and enterprise resource planning systems, the food, clothes and home goods retailer reported a 22 percent growth in sales in its online Direct arm in the 13 weeks to 31 December, compared to a year earlier.

By extending its next day delivery deadline right up until the last days before Christmas, as well as launching a dedicated Christmas food delivery service – with orders taken online – M&S saw a 12 percent increase in overall online order volumes.

The company's overall sales, including store revenues, grew a more modest 2.4 percent, but food sales grew 4.5 percent.

M&S chief executive Marc Bolland said the company had "performed well" in a "challenging trading environment".

M&S is currently overhauling its supply chain, from distribution centres to stores. It is implementing a range of systems from JDA Software, in a bid to improve efficiency and stock level management for its non-food business.

Last year, the company completed the first part of a major SAP rollout across its UK operations. The rollout, being run by services supplier IBM, is part of an IT and supply chain overhaul, called '2020 - Doing the right thing', costing £400 million in the next year alone. M&S described SAP as its future "core business system", as it standardises business processes globally.

The system is live in its foods division, finance office and non-merchandise procurement division, as well as in operations outside Britain. It is currently being rolled out to general merchandise operations, and is due to be complete this year. The company has accelerated the pace of change in order to "fundamentally transform" the way it does business.

The success of M&S' online sales, as the high street suffers, reflect web performance at Next and John Lewis, which both posted strong Christmas e-commerce sales that were key to revenues.

Copyright © 2012 IDG Communications, Inc.

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