Marks & Spencer, the British clothing and food retailer, plans to open 20 new, larger stores in 2023-24 as part of a radical overhaul of its store estate in which it will invest 480 million pounds ($587 million).

The 139-year-old company announced on Monday that the investment would create over 3,400 new jobs across the United Kingdom.

Despite the rise of online shopping over the last two decades, M&S’s move demonstrates the importance of physical stores to retailers.

M&S, as well as rival clothing retailers Next and JD Sports Fashion, have all noted a post-pandemic shift from online to physical shopping during the Christmas trading period.

According to IMRG, an e-commerce trade body, online retail sales in the United Kingdom fell for the first time ever last year, falling 10.5% year on year.

“Stores are a core part of M&S’s omni-channel future and serve as a competitive advantage for how customers want to shop today,” said Chief Executive Stuart Machin.

M&S announced plans last October to accelerate its store rotation program, aiming to complete a five-year plan in three years by 2025-26.

The plan entails reducing the number of full-line M&S stores by 67, leaving 180 higher-quality, higher-productivity stores selling the group’s full clothing, home, and food offering, while increasing the number of food-only stores by 104 to 420.

“Our store rotation programme is about making sure we have the right stores, in the right place, with the right space,” said Machin.

Customers who shop with M&S across multiple channels are eight times more valuable, according to him.

M&S, which reported better-than-expected holiday sales last week, said its new store pipeline for 2023-24 includes eight full-line stores in Leeds, Liverpool, Birmingham, and Manchester. There are also plans for 12 new M&S food halls.

In addition to its owned store investment, M&S intends to expand its convenience store offering through its franchise model, building on partnerships with BP, Moto, SSP, and Costa.

M&S is funding its program in part by releasing development value from some of its older UK locations, including its flagship store in Marble Arch.

Primark announced plans last November to invest 140 million pounds in its UK store estate over the next two years, opening at least four new stores and creating 850 jobs.

(Adapted from Nasdaq.com)