Marks & Spencer sparked renewed fears over the health of the clothing sector yesterday by mounting a mid-season sale just days after distributing 800,000 discount vouchers to “friends and family” of staff.

Customers are being offered up to 50 per cent off thousands of clothing and homeware items in a promotion that comes less than a month before the end of the retailer’s financial year. M&S said there was nothing unusual about the timing of the sale and that there was actually less stock on offer than this time 12 months ago. However, industry insiders said the move was certain to raise speculation about trading at M&S, one of the big high street losers over Christmas.

The items being discounted include more aspirational lines such as Autograph and the M&S Limited and Classic collections. One source said: “There’s a feeling they are massively overstocked in the higher price points.” Eithne O’Leary, retail analyst at Oriel Securities, said: “We would interpret this as a sign that trade has been exceptionally difficult since Christmas.”

M&S said: “We had a sale at the same time last year and we always start with a 50 per cent cut. There is nothing new in what we are doing.”

Last month M&S distributed 800,000 vouchers offering 20 per cent off clothing, food and homeware to staff and M&S pensioners for “friends and family”. M&S said the unprecedented move was a treat for its employees. Three weeks ago, the British Retail Consortium said clothing sales fell for the fourth consecutive month in January. Sir Philip Green, the retail entrepreneur, warned that March and April would be “particularly challenging” for the high street.

Citigroup recently said it expected to see negative like-for-like sales at Marks & Spencer, Debenhams and Next for the next six months.

Debenhams begins its three-day “Spring Spectacular” today with reductions of up to 25 per cent on clothing, homewares and cosmetics.

Tesco loses out to its supermarket rivals

Tesco has recorded the weakest sales growth of the Big Four supermarkets in the past month, figures from TNS market research show. Tesco’s total sales in the four weeks to February 24 were 4.8 per cent up on a year ago, with J Sainsbury up 5.2 per cent, Asda 8.3 per cent and Wm Morrison up 9.5 per cent. Analysts believe that Tesco is struggling as customers cut back on big-ticket nonfood items such as TVs, while Morrisons wins back customers that deserted the former Safeway business it bought four years ago. Tesco’s food growth was 8.3 per cent.

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