Strategic Analysis of Mark &

Spencer

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TABLE OF CONTENTS
Introduction.................................................................................................2
Strategic Evaluation Analysis for M&S.........................................................2
Strategy Evaluation (Through Suitability, Feasibility And Acceptability). .3
Stakeholders Map:....................................................................................3
Strategic Options and Directions..............................................................3
International Market:.............................................................................4
Social Networking:................................................................................4
Facilities to employees:.........................................................................5
Environmental Issues:...........................................................................5
Obstacles in establishing market:.........................................................5
Prospects of stakeholders:....................................................................5
Sustainability:........................................................................................7
Acceptability.........................................................................................7
Feasibility..............................................................................................7
Conclusion...................................................................................................8
References...................................................................................................8

STRATEGIC ANALYSIS OF MARKS

SPENCER

AND

INTRODUCTION
Marks and Spencer (M&S) was founded in 1884 with London as
headquarter. It has over 1064 stores globally in Asia and Europe and
operates in over 40 countries. In the UK it has over 703 stores. During the
1940s the process of internationalisation begin with M&S and started the
export of St Michael brands and at the end of 1955 the organisation
earned more than $1,145,000 of profit. The company captured the
European market during 1975 as France with the entryway hence the
company adopted the French way of life. From the French market the
company knocked the doors of Spain, Germany, Hungary and Belgium and
hence covering the whole Western and Eastern Europe. The main products
and services for M&S includes ready to wear, shoes, children wear, drinks
and food, alcohol, financial services, M&S Energy services, home-ware,
cosmetics and perfumes (Brenkert, 2008). Net profit for 2012 was 489.6
Million (Day, 2013). With exceptional retailing M&S is focused upon giving
high quality clothing, household products and food items.
M&S is measured to be the major retailer with 21 million customers. With
downturn on the merge income and spending of the customers have
decreased gradually. M&S has commenced supplementary products which
can provide assurance to people for availing brand promotions which they
can afford (Brenkert, 2008).

STRATEGIC EVALUATION ANALYSIS FOR M&S

Although M&S operates at a high successful functioning environment still
there is a need for improving the competitive advantage. This includes the
improvement in factors affecting the company through exterior
environment. The company is considered to be receptive to the
economical, technological and social factors which need to be upgraded
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due to altering trends of the market. However the core values were under
assailment due to the fierce competition in the market including Top Shop,
Warehouse, Next and Gap.

STRATEGY EVALUATION (THROUGH SUITABILITY, FEASIBILITY AND

ACCEPTABILITY)
The Johnson and Scholes is a vital model in the corporate strategy which
lends a hand in providing evaluation for the strategic options. These
options are appraised by the help of three decisive factors including
suitability, acceptability and feasibility. These factors respond to the
questions whether the adopted strategy would work or not and whether
the acceptance will be of worth to the organisational behaviour and tactics
(Tsiakkiros, 2002).
The approaches used for such an evaluation includes the key strategic
issues to be addressed for improving the strategic position by the help of
cash flow analysis, decisions trees, break even analysis, ranking of
decision trees and resource deployment analysis. In addition the
acceptability includes the expectations of stakeholders and expected
performance by the organisation. It also includes the return deals which
promote the increment in wealth and value of money and risk deals which
include the probability of failure of a strategy (Bailey, 2000).

STAKEHOLDERS MAP:
The main organisational role is played by senior management team. The
analysis from the statistics reveal that top down autocratic style of
managerial team has moved out and as a consequence the present
managerial team is facing serious consequences as it is at a weaker
position. This is also due to the presence and participation of major
shareholders whose large influence has
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STRATEGIC OPTIONS

AND

DIRECTIONS

For any organisation strategy evaluation includes the measurement of

effectiveness of organisational strategies holds the upmost importance. It
is enormously important for organisations to perform SWOT analysis as it
gives a clear picture for internal and external environment and provides
the managerial board of the organisation to acquire defensive measures
for effectual strategies.
Following are the aspects depict strategic options for M&S which are
critical for measuring their organisational strategies:

INTERNATIONAL MARKET:
With environmental issues M&S has been using organic clothes. Fair-trade
Foundation has been setup to ensure the usage of at least 10% cotton in
cotton clothing in the UK. Furthermore concerning ecological issues M&S
has outlined 100 point action plan for improving the energy effectiveness
and carbon neutral (Finch, 2009).
In Srilanka it has opened its first eco-factories for manufacturing lingerie.
With the latest technology available M&S has expanded globally. Internet
is now the most powerful trading channel
M&S is eager to step into international market and availing new
opportunities by increasing revenues (Campbell, 2010). It imports its raw
materials from India and China which gives a chance to explore new
industries.
SOCIAL NETWORKING :
Through online sales M&S has increased its global revenue by 30% by the
exploitation of social media networking sites including Facebook. It is able
to fetch for every class of audience including the international market
through the usage of apps. People have rated online M&S products 4.1 out

5 globally. It has launched website Plan A which gives people tips and
methods
With Next, TopShop, H&M as competition M&S is increasing its online sales
by giving promotions to the customers. With the change in ownership
model global expansion is through partly owned subsidiaries. M&S strictly
obeys the laws and politics of the local and foreign markets. European
legislation deeply affected the Fashion Industry of UK. However for global
expansion M&S obeys the trade policies and Trade Description Act which
prevents deceiving of the customers
The social media site not just helps M&S in marketing but also creates
awareness about diseases prevalent in society. For instance through
Twitter and Facebook, M&S is able to raise funds 1.7m for Breast cancer
and over 0.3m for prostate cancer (Mellahi, 2002). Hence for attracting
customers M&S can adopt an exceptional technique for increasing sales
and funds for diseases.
FACILITIES

TO EMPLOYEES:

With thousands of employees around the globe M&S provides facilities to

its employees. Over 39,000 employees were given free of cost energy
monitors and home insulation (Blois, 2003). It can also offer one day paid
leave for every employee.
ENVIRONMENTAL ISSUES:
With the passage of time Carbon Dioxide emission is increasing giving rise
to global warming. In the previous year M&S had decreased 90,000 of its
carbon dioxide emission improving the energy efficiency by 25% for their
stores. Thirty M&S stores utilise carbon dioxide refrigeration systems for
avoiding extra emissions. It has also started renewable energy at the
stores by solar photovoltaic panels installation. Food wastage is also a
dilemma hence M&S provides its customers discounted short-life food
products. This has saved food wastage by 38% (Mellahi, 2002).
Consequently M&S can develop strategic management techniques for
environmental issues.
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OBSTACLES

IN ESTABLISHING MARKET :

Although there are unambiguous opportunities for M&S to enter into

emerging markets by its clothing line and superb food items but the brand
is unknown in several markets. For instance it is German market was
unfamiliar with M&S fame hence awareness among customers was hard to
develop to cope through competitive retailers (Campbell, 2010). M&S can
make heavy investments in advertising its brand name for communicating
with customers.
PROSPECTS

OF STAKEHOLDERS:

Conclusively M&S is the pioneer in higher quality value for money brand
due to recent lowered prices of clothing and rebranding. With heavy
investments in advertising M&S was well acknowledged in the recession
era for its worth, quality products (Brenkert, 2008). This in return
heightened the share price of M&S. It has rebalanced its price architecture
for expanding the range of entry price for merchandises and building a
sound relationship with the customers. M&S is intended to release value
from its widespread property including 80 stores. Hence it is aiming to
rent in spite of owning the properties. The financing backup support
includes sales and leasing. For this reason possession of stores at major
and primary locations keeps hold of operations, selling flexibility for
increasing the capital value. M&S has targeted $124 Million for this
purpose. For improving capital structure and velocity of growth earning
M&S has aimed at returning $1.5 Billion to shareholders. The property and
sales sections will be managing its finance (Brenkert, 2008). Hence
subsequent to return of cash to shareholders M&S will be achieving high
financial position with flexibility.
Stakeholders are dependent upon organisations for satisfying their
objectives. The main expectations include corporate governance chain,
organisational stakeholders, formal obligations, and margins within which
stratagem are developed. However the stakeholders of M&S have
divergence between professional managers versus family control, growth
opposed to short term profit, specialist services versus mass public
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service and accountability versus public share ownership (Campbell,

2010). This can result in job losses and compromise on quality of the
products but managerial steps can avoid these issues.
The small shareholders have less authority apart from selling their shares.
The powers for the employees are also limited although their rate of
interest is higher than any other entity. However they are considered while
deciding upon a matter. The strategies manifested in this scenario are
major concern for the management. Hence as long as the administration
team satisfies the major stakeholders their job prospects are higher,
otherwise they are bleak. Hence overseeing the public relations should be
mandatory for every strategy to be implemented. For managing the
procedures and creating new strategy at M&S it is important to keep hold
of the major stakeholders unless they are fully convinced and the map can
be presented as (Hughes, 2001).
M&S floated away from the core values and was unable to keep hold of
fierce competition and changing trends. Hence important customers were
lost and the economic conditions of the company faced a downfall and
recession. Hence there was a brand switch among the customers with
reduced rates.

SUSTAINABILITY :
The M&Ss management board has to ponder upon the core competencies
which provoke the value of consumers. Infrequency and rarity have to be
fixed by the company due to varying consumer behaviour and the impact
the customers perceive for not valuing their needs and requirements as
compared to the competitors. The products have to be unique as they are
copied by other companies and sold at cheaper rates (Grayson, 2011).
ACCEPTABILITY
Through the evaluation of weaknesses present in the company including
high price, lack of strategic directions, reduced market research and lack
of spotlight have to be focused. Hence it is vital to follow the market
inclination for increasing its fame in clothing line. Hence there is a need to
be protracted the challenge from the other retailers including Sainsbury,
Zara, Gap, Old Navy (Jones, 2005).

FEASIBILITY
The strengthening objectives of the company it is feasible and practicable
for converting the threats to opportunities. Global recession has lost the
confidence of customers and investors of M&S. The up and coming
retailers with low cost strategies and supply chain of competitors are
expanding and becoming global. Hence these aspects have revealed low
and poor yearly turnout. Hence the supply chain can be improved through
taking the steps of value chain analysis and improving the logistics. The
recession can be turned away through improving the prices of the
products (De Brito et al., 2008).
Further selection through sustainability, feasibility and acceptability can
be optimised through strategic options and directions mentioned below.

CONCLUSION
Marks and Spencer is one of the leading fashion hub and grocery store
worldwide. It has large market place globally for flourishing and
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maintaining top position. The current strategic position suggests that its
services endow people with satisfaction. It always finds innovative
strategies to accommodate itself in marketplaces through balancing
domestic and overseas operations. It is recommended for M&S that it
should introduce some promotional tools to its customers with increasing
inflation in the market. It needs to improve its actions related to store
designing, logistics and operations in Asian countries including India,
China and Nepal with respect to consumer behaviour. Purchasing of raw
materials from foreign countries should be increased for reduce the cost of
the products of the host countries. It should avoid prolonged decision
making strategies for a positive outcome.

REFERENCES

Bailey, A., Johnson, G., & Daniels, K. (2000). Validation of a MultiDimensional

Measure of Strategy Development Processes. British Journal of Management,
11(2), pp 151-162.
Blois, K. (2003). B2BRelationships'-A Social Construction of Reality? A
Study of Marks and Spencer and One of its Major Suppliers. Marketing
Theory, 3(1), pp 79-95.
Bryson, J. M. (2004). What to do when stakeholders matter: stakeholder
identification and analysis techniques. Public management review, 6(1),
pp 21-53.
Brenkert, G. G. (2008) Marketing ethics, WileyBlackwell, London.
Campbell, D., & Abdul Rahman, M. R. (2010). A longitudinal examination
of intellectual capital reporting in Marks & Spencer annual reports, 1978
2008. The British Accounting Review, 42(1), pp 56-70.
Day, E. (2013) Marks and Spencers Stuart Rose: Im like a 3.49 chicken
jalfrezi! Its got a punch, its got zest, and its just fabulous to be with,
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De Brito, M. P., Carbone, V., & Blanquart, C. M. (2008). Towards a

sustainable fashion retail supply chain in Europe: organisation and
performance. International Journal of Production Economics, 114(2), pp
534-553.
Finch, J. (2009) Marks & Spencer sales figures suggest return of
consumer confidence. M&S chairman Stuart Rose says consumer
confidence has reached the bottom. People feel better about life,
Grayson, D. (2011). Embedding corporate responsibility and sustainability:
Marks & Spencer. Journal of Management Development, 30(10), pp 10171026.
Hughes, G., & Hay, D. (2001). Use of concept mapping to integrate the
different perspectives of designers and other stakeholders in the
development of elearning materials. British Journal of Educational
Technology, 32(5), pp 557-569.
Jones, P., Comfort, D., Hillier, D., & Eastwood, I. (2005). Retailers and
sustainable development in the UK. International Journal of Retail &
Distribution Management, 33(3), pp 207-214.
Mellahi, K., Jackson, P., & Sparks, L. (2002). An exploratory study into
failure in successful organizations: The case of Marks & Spencer. British
Journal of Management, 13(1), pp 15-29.
Smithers, R. (2009) Marks & Spencer launches UKs greenest till roll,
Guardian.co.uk
Tsiakkiros, A., & Pashiardis, P. (2002). Strategic planning and education:
the case of Cyprus. International Journal of Educational Management,
16(1), pp 6-17.

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