LONDON -(Dow Jones)- Marks & Spencer Group PLC (MKS.LN) said Wednesday it will start to sell branded grocery products like Coca-Cola, Marmite and Persil in all its U.K. stores over the next year, following an extended trial in certain parts of the U.K.
Marks & Spencer is under pressure to turn around its underperforming food business, which is losing customers to less-expensive grocers such as J Sainsbury PLC (SBRY.LN), and even to upmarket rival chain Waitrose, part of the John Lewis Partnership.
The company said the range of grocery and household products will focus on brand-dominated categories where M&S would typically have a low market share like soft drinks, beer, personal care and pet food; or on filling gaps where M&S has no own brand equivalent.
The new range, which will also include products from Kellogs, Heinz and Pantene, will be rolled out to M&S stores over the next year, starting this month with additional stores in the trial areas, and expanding into other regions from January 2010.
In June 2008, Marks & Spencer started trialing around 350 branded products, which represents some 7% of its product range, in 19 stores on Tyneside and Teesside, and extended this to include 20 stores in the south east in March 2009 and a further 13 stores recently.
John Dixon, executive director of food, said the company is focused on delivering the innovative products that provide quality and value, "but there are some products that we could simply never compete with, like Marmite and Kit Kat, and other areas where, whilst we have a great M&S equivalent, the leading brand dominates the market."
"Adding the nation's favorite brands to our mix offers our customers more choice and strengthens our position as the U.K.'s leading quality food retailer," Dixon added.
-By Kathy Sandler, Dow Jones Newswires; 44-207-842-9293; kathy.sandler@dowjones.com