Jeff Banks attacks Sainsbury's clothing retail strategy

Sir Peter Davis, the chief executive of J Sainsbury, was yesterday under fire over his clothing and home furnishings strategy after it emerged that the supermarket chain had ended its three-year-long relationship with the designer Jeff Banks.

Next year's spring/summer collection will be Mr Banks' last for the supermarket. He has been behind an exclusive range of adult clothing for the supermarket since 2000 that was intended to rival the success of the George range at Asda. The former BBC presenter hit out at Sir Peter, saying his strategy in non-food items was in "disarray".

"The constant problem has been Sainsbury's lack of ability to retail clothing," Mr Banks said. "Warehouse management, staff levels, staff training, IT, instore merchandising, little advertising support, have all proved problematic. Sir Peter has tried to change a culture in Sainsbury's of a lack of enthusiasm for non-food products. The strategy now appears to lie in disarray."

Mr Banks says he is now negotiating a pay-off settlement with the supermarket, saying there are "no grounds for a termination". But Sainsbury's yesterday said its clothing contract was with Baird Menswear Brands (BMB), to whom Mr Banks is a supplier, and not with Mr Banks directly. Sainsbury's said there had been no breach of contract with BMB.

Analysts were broadly in agreement with Mr Banks over Sainsbury's failure to produce results in clothing sales. "Sainsbury's has never really understood how to construct its non-food proposition," said Rhys Williams, an analyst at Seymour Pierce. "It has been unable to successfully integrate clothing into its stores and has certainly not done it as well as Tesco and Asda, which are light years ahead. But as usual, the timing stinks."

Many analysts were concerned that Sir Peter has left it too late to make the change. He has until March to meet his own targets for turning around the business. While the switch to a new designer may prove to be a boost to its non-food sales, the City wants Sainsbury's to buckle down and deliver growth. "Jeff Banks was at least a recognised name and was strengthening its position. This puts Sainsbury's further back in its progress," one analyst said.