Business Strategy of Marks and Spencer


Business strategy is essential which help in achieving specific goals and targets of an organization. It is one important administration plan that will assist in enhancing performance of the company. Along with this, it will aid in demonstrate the direction to employees for reaching with set goals and objectives and without this it is very complex for compete with their rival in the large market place. The business strategy assist in gaining business power and intelligence. The one of the main function of company is to producing appropriate business strategy. The report is based on Marks and Spencer which is British international merchandiser company and its headquarter is located in the city of Westminster, London (Ackermann and Audretsch, 2013). The main purpose of this assignment is to understand business strategy for analyse the impact of PESTLE on the organization activities and functions. Also they need to analyse the strategical capabilities by using VRIN structure.

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P1 Analyse the impact and influence of macro environment on organization

Business strategy define as the company high level of planning while reaching with specific business goals and objectives. It is long term activity which help in designing to achieving a particular targets of the company. Strategy is administration plan which enhancing their firm performance and growth level. Business strategy can be define as the plan of action and effective decision making which help individual person for achieving its objectives and goals. It is the set of competitive activities and movements which can be used by company for attracting large number of customers, gaining organisation targets, increasing employees performance and attaining higher success.

PESTLE analysis:

It is the external analysis which directly or indirectly affect on business operations and its functions effectively. This analysis provide a framework to investigate the firm non controllable external factors which desire to influences on operations and functions (Alsoboa and Aldehayyat, 2013). With the help of this investigation, the Marks and Spencer take better position for determining the implications and reduces the future organisation related risks.

  • Political factors– Marks and Spencer firm has been favoured with the ECs free trade agreements and which can led to reduces sourcing value or cost. The political factor are those factors which are developed, changed and run by the government authorities. Such factors shows anticipation level which are doing various trades and businesses. For the M&S, high value is disadvantages in the international market place.
  • Economic factors– It is that factor which are determinants of economy's performance that directly or indirectly effect on firm growth and it is long term factor. Marks and Spencer economic rate is directly affected by rivals discounting values. In this, company mainly concentrate on high quality services that can reduces their short term damages and large number of customers are attracted towards products quality which offer by an organisation (Bentley, Omer and Sharp, 2013). Along with this, M&S need to organise and conduct effective economic analysis. This is important for determining the state of economy on the basis of short and long term. An organisation also require to focus on latest trends in which young generation are spend most of their expendable revenue on clothing.
  • Social factors– These are fundamentals which does not directly regulated and operated by company but this will affect business marketing strategies. Marks and Spencer are alter lot of things as per their customers needs and wants. Most of the company customers are over age 40 who are mainly purchase different types of products to the M&S. They are analysing their desired consumer needs and requirements and according to their demand they offer variety of goods or services. Also the company examine the whole latest social trends which need to offer by customers for gaining attention of them towards new facilities.
  • Technological factors– It is the vital factor in the retail market place. They need to adopt various new techniques and methods for producing unique type of commodities for their users. Marks and Spencer has powerful social media and online existence which help them in gaining high amount of income or revenue (Cadle, Paul and Turner, 2010). Most of the consumers are purchasing products through internet so firm need to update its sites on regular basis. M&S require to develop and build its presence in the digital media for taking higher advantages in better manner.
  • Legal factors– In every country, legislation is always change according to the government. Marks and Spencer require to bring out training and development sessions in each year, through this they will be updated regarding its current laws and norms. If authority change its rules and regulations so this is necessary for firm is to modify its norms as per the government. M&S require to follow all rules which are developed by nation authority and also implement in their business operations and its functions.
  • Environmental factors– In this factor, Marks and Spencer need to produce those product which does not harm to the country environment or surroundings. The company product is sustainable in the whole market place (Curwen, 2011). With the change in current environment, there are various issues regarding protect environment are promoted on the television, magazines and radio for make awareness among country people.

Stakeholders analysis of Marks and Spencer:

Stakeholder is a person, group and institution which help in contributing interest in an organisation. Stakeholder analysis assist in identifying the interest in the specific project and recognise disputes for evaluating the relation among stakeholder project. In Marks and Spencer company, stakeholder are play an important role in understanding the relationship with stakeholder and also determine the place of the company.


P2 Analyse the internal environment and capabilities of given organization by using framework

The internal environment help in recognise the company strength and weaknesses which has been controlled by people with an organisation. Along with this, there are large number of accessible factors that assist in making appropriate decision which are related to internal aspects that includes skill, manpower, company structure, management efficiency and culture. Such components directly impact on firm profitability and productivity while maintaining relation with internal environment forces (D'Aveni, Dagnino and Smith, 2010).

Strategic capabilities:

It is essential factor which provide ability to the organisation that main purpose is to execute appropriate strategies for achieving high level growth and sustainability within market area. Marks and Spencer mainly develop effective strategies and also formulating decision to use different methods by pleasing their customers needs and wants in better manner. A firm require to determine poor examination of environmental factors which can be control and regulate whole business in effective way. The main aim of this factor is to change in technology and methods for smoothly running of business operations and functions.

VRIO/VRIN model:

It is the model which describe about appropriate usage of required resources which main motive is to reaching with sustainability and gaining long term growth in the large market area. Marks and Spencer mainly concentrate on improving their business operations and performance by using human resources and workforce so they will be capable for reaching with set goals and targets. M&S also determine the employee improvement and development for carry out creative ideas for making effective goods and services in better manner (E. Dobbs, 2014). In addition to this, it will assist in maintaining strength capabilities with using various techniques or methods that are described as under:

Valuable– It is an important factor which assist in giving emphases for acquiring higher growth and success. Along with this, it is required for each company is to use necessary resources and eliminate the possibility of risks or uncertainties for avoiding delay in better manner. It is useful for removing threats and barriers for promoting the business in the huge competitive world. Marks and Spencer mainly focus on allocating resources and gaining maximum results with minimum production.

Rare– It refers to that firm for gaining chance regarding getting adequate resources which offer best quality based products and services in the large market area. Thus, firm need to determine required resources which help in producing unique and attractive commodities for gaining numerous of customers.

Imitability– It is an essential and best appropriate solution resources which are required for making effective products or services and which can not be steal by another individual. Marks and Spencer company is delivering specific goods and facilities of internet solution, mobile networks and some more with the help of required resources in better manner (Firnkorn and Müller, 2012).

Organised to capture value– The resources does not confer any benefit for the firm so if it is not arranged to capture value from them. The company need to maintain its administration systems, policies, strategies, organisation culture and structure that can be capable to understand its value, rare and cost to imitate capacity or resources.

SWOT analysis of M&S:

Marks and Spencer is the multinational retailing company which is situated in united kingdom and offer variety of products to their customers. The company mainly focus on retailing and they have wide range of private label products. The SWOT analysis of M&S firm are explained as follows:

Strength– Marks and Spencer has strongly concentrate on UK market with 90% of its income from this area. The company introduce unique and innovative type of goods which attracting large number of customers. In the year of 2015, M&S offer variety of commodities to 33 million customers and also expand their business operations or functions in all over the world. They are using multi channels for achieving its set target market through online, mobile and catalogue and in store channels (Grover and Kohli, 2013). They are participated in the reduction of greenhouse emissions and take position as a world most responsible organisation.

Weaknesses– Marks and Spencer visible the trust on united kingdom market which vulnerable to fluctuate in the domestic market situations. They are facing various other issues such as space problem where 75% of square of footage covered but still market share of clothing has not enhanced.

Opportunities– Marks and Spencer has introduced appropriate plan which help in expanding their food business and also announcing new 250 shops in the year of 2016. it is that strategy which concentrate on food part which provide around 52 percent income that assist in taking position of food segment. Along with this, firm has enhancing the existence of china and India seems to be largest marketplace in the world.

Threats– In UK, marks and Spencer are facing increment in the scourge of shoplifting. Sometime, there is dispute occur between shareholders and executives. Also the newly appointed higher management does not suitable in the corporate culture. Along with this, main issue is ineffective execution of proposed strategy (Johnson, 2016).


P3 Porters five force model evaluate the competitive forces in market sector

For examining whole environmental factors and develop various strategies and policies for firm in achieving potential goals and objectives. It is important for understanding competitiveness in the merchandising sector. Thus, it is necessary for developing accurate strategies for surviving in the huge competitive surroundings. Marks and Spencer adopt porters five force model to analyse the impact of business operations and its functions in better manner. These factors are described as follows:

  • Threat of New Entrants– The major barrier for retailing market is its capital investment which are large to enter in the market place and they are reaching with effective cost and economies of scale such as Marks and Spencer has face complexities to achieving with new player. The company mainly focus on best quality based services for making competitive in breaking the loyal customers (Kernbach, Eppler and Bresciani, 2011). They have quality products benefits, rivals are offering discounting products to the desired consumers.
  • Threat of Substitute products– Marks and Spencer need to conduct continuous innovation for making strong position and focus on meeting with need of customer base. The clothing business is very easy for copying the design of other company products at very reasonable cost. The major competitors of company is TESCO, Sainsbury and ASDA that are delivered in the same price of commodities. Along with this, company mainly concentrate on its food line which is expected for clear benefits over the immense rivals.
  • Bargaining power of buyers– For marks and Spencer, customers bargaining power is very important. Customers has very low changing amount and there are various options are available. M&S require to develop and build its loyalty among customers which are mismatched and basic requirement are not easy to match. The company also shift towards vulnerable to negative displacement in the customer point of view in the united kingdom.
  • Bargaining power of suppliers– In the past decades, Marks and Spencer were leading British, but competitive pressure force company to outsource and decline its value that weak the power of suppliers. They are mainly concentrate on private description which provide power on the external suppliers (Klettner, Clarke and Boersma, 2012). The shifting cost for marks and Spencer suppliers are depending upon external providers which are very low.
  • Intensity of competitive rivalry– Competition is very strong for the retailing industry against other supermarket firm which offer home items, fashion products, food items and clothings. The competition is increasing in online area where users are selecting click and gather experience of purchasing goods at lower cost. M&S are capable for developing and building its online sales for attracting consumers. The company focus shifted towards older female users and supply products on discounting or cheap rate. The low cost strategy reducing the sale volume of clothing business.

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P4 Theories, concepts and models for interpret the strategic planning of organization

In each business concern, company are require to develop effective policies and use appropriate methods in gaining competitive benefits for long time period in well organised manner. This is necessary for firm is to develop accurate plans and taking initiative steps that includes each company need to develop and create its customers value for analysing their needs and demand and offer them appropriate products according to their requirements in better way (Li, Zhou and Si, 2010).

Marks and Spencer try to develop appropriate position within the market place for undertaking Bowman's strategy clock model because it is required for giving various dimensions. There are certain strategies which are described as under:

  • Position 1, Low price and low value added– It is an effective and best appropriate strategy that is useful for recognise the position of company in the competitive market area. This is mainly dealing with different products or services so they are delivering best quality at reasonable rate. This will affect on customers purchasing decision so that it is required to develop pricing strategy in effective way.
  • Position 2, Low price– It can be described that each company need to concentrate on reducing the value or cost which arise at the time of smoothly running of business operations or functions. It is essential strategy that can be used by firm so by this they are offering different goods and services within the market for gaining attention of large number of customers (Pagani, 2013). Marks and Spencer mainly developing strategies which can reduces the price of food item, home appliances and so more which are willing to buying by users to the firm.
  • Position 3, Hybrid– This is usually concerned with different elements that includes lower value and product differentiation that are necessary for develop specific strategy and conduct action plan in more appropriate way. The firm mainly focus on change variety of goods by adding some features and also gaining attention of more buyers towards firm products effectively.
  • Position 4, Differentiation– The main objective of each company is to provide best quality based products and services by determining different techniques and methods like introducing new goods and alter the present one. It can be possible by developing effective strategies and policies which are attracting large number of customers.
  • Position 5, Focused differentiation– It refers that there are different goods which are taking appropriate place by charge reasonable rate. Also customers are ready for pay such amount to satisfying their specific needs (Porter, 2011).
  • Position 6, High risky margins– This can be identify risk or uncertainties for selling goods with higher rates.
  • Position 7, Monopoly pricing– It is beneficial for developing and formulating business in better manner. M&S need monopoly in offering clothing products.
  • Position 8, Loss of market share– It can be defined that there can be possibility for lose the market share so firm need to develop strategies and set appropriate prices which help in gaining attention of large number of buyers.

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