For Rose, who yesterday announced the retail giant's worst sales performance in thee years it was confirmation of what he already suspected – the economic slump is going to change the way the nation shops.

"Higher petrol prices mean that people don't want to drive, so they're going to their local shop more often" he says. "This will change the way we shop. If you're not going by car there's a limit to what you can carry. Do people still want to drive out of town? Will they make two journeys rather than one?"

These are the questions keeping Rose busy as he tries to steer
the group through the worst downturn since the recession of the early 1990s.

"This is the fastest and most severe slowdown since the 1990s. We're not in recession yet, but we have a very unpleasant set of economic circumstances affecting us. The government must not let confidence slip below a certain level – whether it does that through relief on fuel costs, road tax changes or not putting interest rates up. The danger is uncertainty."

While Rose hopes that Gordon Brown's beleaguered Government will do its bit for the cash-strapped consumer, he is also drawing up plans to stop the millions of people who shop at M&S every week from going elsewhere.

He admits that without a doubt some customers are switching to cheaper rivals such as market leader Tesco, Bradford-based Morrisons and Leeds-based Asda.

"People are trading down and some businesses will be more resilient. We have to adapt to the current circumstances and I'm confident we'll come up with a solution," he claims.

Following a marked decline in M&S's food market share over the past month, Rose says the group has two distinct types of shopper
it has to win back.

"Some 80 per cent are the hardcore M&S customers who are loyal to the fact we sell quality food. The other 20 per cent are occasional shoppers. We have to make sure we accommodate the occasional shopper. I understand their pressures."

Empathy with his customers is something Rose is determined to get across. "We need to look at the whole offer for the customer so that when she comes in we get it right – the right promotions that reflect the pressure on her purse. We need to stay in tune with her needs in what is probably the biggest price war we've had in 20 years. We've got to find a way to say 'How do we keep you with us?' We have got to tell them we understand and keep them loyal to us."

The most obvious way to retain hard-up consumers is to launch a budget range, something that all of M&S's mid-market rivals have done.

According to Asda's retail director, Andy Clarke, customers are switching to cheaper products towards the end of the month to save money in the week before pay day.

"People are buying more mince and potatoes as they are more value-orientated," says Clarke.

But while M&S is happy to launch bargain clothing ranges such as its £9 jeans, Rose has categorically ruled out launching cheaper food ranges. "We will only offer the best quality in food," he asserts. "We won't downgrade. We have no plans for cheaper own brand ranges. We won't join in the price war."

So, having ruled out a budget range, the group is now looking to roll out initiatives such as its well- received "Dine in for £10" promotion. Sainsbury's may be offering to feed your family for a fiver, but M&S is setting its sights higher.

"We were mobbed when we launched the 'Dine in for £10' promotion," says Rose. "Our customers like that sort of promotion rather than three for two or money off."

He says it's "a fair bet" the group will launch another "Dine in for £10" promotion, but he's keeping his other promotional plans to himself for now.

The promotion offered a complete "restaurant quality" meal for two people. A typical deal included a prawn and chicken paella accompanied by vegetables or salad, raspberry panacotta and a bottle of Pinot Grigio.

One of the trends being seen across the supermarket sector is people buying more expensive foods for special occasions.

Asda's Clarke says that customers are buying cheaper food on weekdays, but treating themselves to top-of-the-range goods at the weekend as an alternative to eating out.

In addition to promotions, M&S is launching a trial of 350 branded goods such as Marmite and Heinz tomato ketchup in 19 stores in
and around Newcastle next week.

Rose says: "I've had customers come up to me and say 'Stuart, I love your food but my Johnny loves Marmite'."

The group is hoping that customers who go elsewhere to buy their brands will now do a one-stop shop in M&S.

While Rose is all for showing empathy with his customers, this doesn't extend to the rest of the M&S board.

Director of food Steve Esom, who joined from Waitrose just over a year ago, was sacked yesterday to be replaced by John Dixon, a seasoned M&S veteran of 15 years who knows how to ride through the tough times.

Rose was keen to emphasise that while Esom was the right man for the job during a growth period, the group now needed someone with more M&S experience to get it through a difficult time.

"It's different horses for different courses. Steve has done a good job, but the market has changed."

Rose admits that M&S has to take some of the blame for its falling sales. While he says the downturn in clothing was "25 per cent our fault and 75 per cent the market", he claims the downturn in food was "40 per cent our fault and 60 per cent the market".

Esom, chairman of the "Seeing is Believing" initiative to help North Yorkshire's moorland farmers, will have to carry the can.

While Rose is predicting more bad news for the economy over the coming months, he is adamant that M&S can weather the downturn.

Fellow upmarket retailer Waitrose, which recently reported a 5.2 per cent increase in sales, is equally confident. Waitrose is planning to open up to 100 convenience stores based on estimates that there are four million middle-class shoppers who would like to shop regularly at Waitrose, but can not do so because they live too far away.

"We believe that instead of going out, many of our customers are spending more time in the kitchen, trying different foods and cooking from scratch," says a Waitrose spokesperson.

"Our Sheffield branch has seen a 16 per cent increase in sales of our Cooks' Ingredients range, while there has also been a 34 per cent increase in sales of flour. This is a trend being helped by celebrity chefs who are giving customers the confidence to try new recipes and be more creative with what they cook."

While times are tough, the high-end food retailers are not expected to disappear from our high streets. "This is not the end of the upmarket food retailer," says Seymour Pierce analyst Freddie George. "Consumers are trading down in format, moving to the more value-orientated retailers, but this is not the end for M&S. They are the biggest clothing retailer in the UK, although they do have some issues to tackle."

To borrow from the M&S slogan "This is not just food... this is M&S food", the message from Rose is that this is not just an M&S
slump, this is a universal slump and it might be here to stay for several years.

In the meantime, Rose is determined to do all he can to persuade M&S shoppers to stay loyal during the difficult times ahead.