M&S's brand new plan shock

Doubts have been cast over Marks and Spencer's (M&S's) strategy, following its decision to change its supplier of Italian ready meals and to stock 350 brands in store.

"The move to brands is pretty futile. It doesn't make any sense," said Pali International analyst Nick Bubb. "I think M&S will quietly drop it in the autumn."

Shore Capital analyst Clive Black didn't dismiss the move, but agreed that it would be hard. "The challenge will be in making them [brands] totally complementary to its own products and getting the prices right - you don't want to find out that M&S is selling products at x% more than Tesco."

M&S defended its decision to move into brands, claiming it was a low key trial in response to the needs of time poor consumers. "Pricing will be competitive," said a spokeswoman.

The retailer was also criticised for its "mutual" decision to stop using Northern Foods as its pasta meals supplier, which resulted in the announcement of the impending closure of Northern's Fenland Foods factory in Grantham and the potential loss of over 700 jobs. "It's counterproductive to push Northern so hard that it ends up closing a factory," said Bubb.

However, M&S claimed that the decision was mainly due to the fact that the site's facilities were not up to scratch. "The Fenland factory is 25 years old and in order to keep innovating we need an up-to-date facility," said the spokeswoman. "It is a mutual decision we've taken with Northern Foods [to end the contract] and the firm remains our biggest food supplier."

Speculation is already mounting over M&S's new supplier of Italian meals. Black suggested that RF Brookes, owned by Premier, or Bakkavör, could be contenders. But Bakkavör's plans to close its pasta plant in Scunthorpe could leave the door open for Premier.

A former Fenland Foods employee said: "If Northern isn't making money out of the M&S arrangement - and it's not as though it [Northern] has horrendous overheads - then I don't know which company can," she said. "It's sent shockwaves through the industry because it's a company that's had such a strong relationship with M&S," she said.

Fenland's GMB union members planned to demonstrate outside M&S's Marble Arch store, London, on May 29 to fight for their jobs.