Marks & Spencer has stellar Christmas after customers splash out

Marks & Spencer has had a fantastic Christmas as customers splurge on their range of festive foods, according to closely monitored industry data.

The food sales of the chain store giant have increased by 10.5 percent in the four weeks to December 25 compared to 2021, the figures show.

The increase has clearly moved it away from its main rivals. It also means the chain is poised to hail its second stellar Christmas run in a row in its food division. Turnover grew by a similar amount last year.

M&S will also reveal on Thursday how its clothing business has fared.

The figures, compiled by market research firm Kantar, have been distributed to the top managers of the food industry. They show a clear division between companies that are holding their own and those that are falling behind.

Sales at Tesco and Sainsbury’s rose by 8.5 percent and 8.4 percent respectively in the past four weeks. Those at Waitrose rose 1.5 percent, while Morrisons fell.

Struggling customers are already switching to discounters Aldi and Lidl, already known as the food sector’s two Christmas winners, with a turnover increase of a fifth. M&S is targeting Tesco and Sainsbury customers in an attempt to entice them to spend more in the food halls and convenience stores.

The retailer is adding assortments to its delivery service with Ocado, including more budget products. But M&S, known for its luxurious ranges, has also been working hard to make further improvements to its signature products, including the Cherry & Orange Liqueur Christmas Pudding Wreath and its Blood Orange & Cranberry Vodka.

Stuart Machin, the former chief executive of the food division, was promoted to CEO two years ago in recognition of his success in improving performance. An industry executive said: ‘M&S has the momentum that some of its rivals, Waitrose in particular, would die for. The indications are that Marks & Spencer is gaining momentum – while Waitrose seems to be falling further behind.”

But supermarkets are under increasing financial pressure from rising labor, energy and raw material costs. Annual food price inflation rose to 13.3 percent in December and prices are expected to rise further early this year.

Retailers had a sluggish November, but there are growing signs that shoppers were moving out in December, despite cost-of-living pressures and a spate of strikes threatening to stifle demand.

M&S shares took a lift last week — up 11.5 percent — following a positive statement from fashion rival Next. Shore Capital analyst Clive Black said the performance of Next, patisserie retailer Greggs and value retailer B&M “encouraged” the city for the forthcoming slew of statements from others.

He said analysis by Next boss Lord Wolfson suggests a more “stable and improved” period may be ahead for the high street.

Tesco will announce its Christmas figures on Thursday. Sainsbury’s will publish its figures on Wednesday.