Marks and Spencer CEO Marc Bolland to step down as Christmas merchandise sales plummet

Marks and Spencer (M&S) announced on 7 January that chief executive Marc Bolland will retire in early April after the bellwether retailer reported a major drop in general merchandise Christmas sales.

Bolland will be succeeded by new director of general merchandise Steve Rowe. Rowe previously worked in M&S's food division and replaced John Dixon, who quit in July 2015.

General merchandise fell 5.8% on a like-for-like basis in the 13 weeks to 26 December. The retailer's GM part of the business has been management's Achilles heel for almost 10 years. Its food division has saved sales and profit outlooks over the last quarters, despite the deflationary market.

Bolland told BBC's Radio 4 on 7 January that the trading quarter, which he said was not as bad as it was made out to be, was unrelated to his departure. He stated that he informed the board in the summer of 2015 that he was planning to leave in 2016.

"It has been a huge honour to lead one of Britain's most iconic companies," Bolland said in a statement. "I am delighted to handover to Steve Rowe as my successor. I have worked closely with Steve for six years and I am convinced that he will be a great leader for Marks and Spencer."

Bolland is set to stay in his position until 2 April, at the end of the current financial year. In May 2014, he reported a full year profit rise, the first in four years. He had promised a turnaround to work on M&S's brand and sales but investors said it was taking too long.

The retailer's share price has climbed over 15% under Bolland's regime, although sales in the current financial year have not taken off significantly yet. Merchandise was down 0.4% like-for-like in the first quarter.

"After such a dismal Christmas, Marc Bolland has jumped before he was pushed," said John Ibbotson, director of retail consultancy Retail Vision. "All the excuses in the world about unseasonably warm weather can't hide the fact that a 5.8% slide in like-for-like non-food sales is little short of dismal.

"M&S's clothing operation is now a fallen colossus. Years of long-term decline have seen it lose both its identity and market share, and the decision to sacrifice quality in order to cut costs has proved toxic for the brand's core middle-class customers – who have been deserting in droves."

M&S shares were up more than 1.5% in early morning trading, although many think Rowe is facing a puzzle with the retailer's divided business. Despite its soaring food results, merchandise will be a long-term struggle for the firm, according to the City.

On BBC's Radio 4 Today programme, Bolland, who is known for his ability to calmly face the press, said he has completed core tasks such as restructuring the retailer's website in his six-year period at M&S.