Marks & Spencer is continuing efforts to reduce costs by clamping down on staff expenses....
Marks & Spencer is continuing efforts to reduce costs by clamping down on staff expenses.

The move follows confirmation of poor festive trading figures.

An e-mail edict was sent to staff shortly before Christmas informing them they must not use first-class travel and must avoid expensive hotel accommodation, or else pay the excess over an agreed level.

M&S chief executive Stuart Rose said his cost reduction and restructuring of the business was on course and stock commitments had been reduced by 25 per cent. He said: 'As far as I'm concerned the reduced stock is exactly where I want it to be. We're clean and I needed it to be clean.'

He said footfall over Christmas had risen 3 per cent, helped by the Your M&S campaign, but the increased traffic is still failing to convert into rising sales.

The effect of the stock clearance forced the retailer to cut its profit guidance for the year to March to between£600 million and£625 million, compared with previous expectations of between£645 million and£680 million.

Teather & Greenwood analyst Sanjay Vidyarthi said: 'I don't think this was as bad as some of the most bearish expectations. This is about arresting the decline. The market will be expecting a glimmer this spring, not a turnaround.'

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