Comment: Next on rise | Mulberry woes

Next, helped by a stellar performance over Christmas, struck an annual profit of £695.2 million – up 12 per cent on a year ago, and comfortably ahead of the City consensus expectation of £628m at M&S.

If this is a changing of the retail guard, it is no mean feat. Next was only launched in 1982, compared with M&S’s beginnings in Leeds in 1884.

M&S is a totem of the high street, with an almost atavistic call on the loyalties of British consumers, whereas Next, for all its success, has never exuded that emotional pull.

Yet, like football league tables, over an extended period retailing trading performances do not lie. And Next, under chief executive Lord Wolfson, has gained ground inexorably on the bigger and older M&S.

How has the younger company done it? Well, for one thing, Next’s management has been a model of continuity compared with the significantly greater change at M&S, even though the latter’s latest chief executive Marc Bolland has been there for four years this summer.

Next has also stood out from the crowd in never being a slave to like-for-like sales advances as long as the general picture has been one of growth and profitability.

Protection of margins has always seemed an article of faith for Wolfson rather than just chasing footfall and sales. This has been typified by Next’s sturdy refusal to discount before Christmas no matter how uncertain trading is in the festive run-up.

And it is easier said than done for a retailer to keep its nerve in this way, particularly given the tough Christmas periods we have had in recent years due to the prolonged downturn.

Meanwhile, the Next Directory is a model of how an internet and catalogue business should be run, complementing not cannibalising the bricks-and-mortar offer.

I suspect Next has also been helped by its far more targeted focus on fewer overall ranges and customer demographics (younger than M&S’s).

M&S, through its historic place in the mind of the British consumer, has always had to cover the waterfront to an extent, in fashion terms being all things to all women, and sometimes looking thinly spread as a result.

Wolfson’s shareholders are also happy that the latest dividend, up 23 per cent, is the fifth consecutive year that payouts have risen more than 15 per cent.

Next has won plenty of plaudits in recent years. They are deserved. By contrast, M&S, under Bolland, remains a work in progress.

Mulberry man pays high price for high prices strategy

for Bruno Guillon at fashion handbag maker Mulberry it has been a vortex, not a carousel. Three profits warnings, a 60 per cent slump in the share price, and the loss of the company’s star designer in his two years in charge has triggered his departure.

Formerly at French luxury brand Hermes, Guillon’s crucial wrong call was to take Mulberry upmarket and ramp up the prices. Customers effectively said, your products are nice, but not that nice, and deserted.

Expect Mulberry bags to be merely pricy in future, rather than extravagant.