Business Report: Marks and Spencer. Objectives and External and Internal Factors.
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Business Report: Marks and Spencer Generally looking at the retail industry, it could be said to be within a very dynamic and a fast changing sector. In terms of transactions and turnover; it represents a large sector in the economy and so as a result it is quite a sophisticated industry which is very competitive. In this report, a critical analysis of Marks and Spencer, a company who is amongst the large retail industry will be given. Business Overview A Russian born Polish refugee opened a stall at Leeds Kirkgate market in1884, his name was Michael Marks. And it was on that day which could be said as the day Marks and Spencer was born. Marks and Spencer is now a very large and dominant company and can be classified as a public limited company, it sits within the top 6 UK retailers. It is a century old retail sector organization, (they are currently celebrating their 125th anniversary) that has seen tremendous growth in the retail business across the globe through innovative methods of business and marketing. It is a business that provides goods and services e.g.
Business critics argue that the firm must grow in order to survive; failure to grow might result in a loss of competitiveness. Marks and Spencer own 885 stores in more than 40 territories around the world, over 600 domestic and 285 international. If Marks and Spencer are able to grow, they could dominate their expanding markets, and probably take it into using it to enjoy some monopoly power and raise its price. If they do so successfully the benefits of economies of scale can be used to full advantage. Regarding the strategic objectives, sales have been falling especially with the arrival of store such as Primark. Former chairman and chief executive Luc Vandevelde announced in 2001, "Its objectives will not surprise you. We wanted to return Marks & Spencer to its former position as the standard against which others are measured. We want M&S to be famous once again for its quality, value, service and innovation, drawing on strengths which still exist but which may have been overlooked. We want to inspire trust in our customers, and we want to reward you, our shareholders, for loyally standing by us."
Conclusion and Recommendations The downturn for Marks and Spencer was that they did not respond quickly enough to the changing taste and preferences of their consumers, and the have acknowledged this. For instance the clothing sector of the company especially the womanswear, they suffered from a lack of originality and did not reflect the modern taste for a more casual look. Same goes for the food section, although they remained in their market position, sales were less significant as result competitors are quickly catching up. Future recommendations, will be to expand target audience e.g. innovate to young adults as well as women, this will spread risk and provide a safety net if women clothing fail again. One other thing is to as mentioned earlier to expand on the technological and furniture side of the business, this also spreads risks, but will gain market share and allow Marks and Spencer to become an even more powerful leader. Not only that in doing that brand image might be restored not only in the clothing department but also on the technological and furniture department proving an even stronger brand image and securing that brand loyalty.
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