strategic challenges faced by marks and spencer

Discussion On Marks And Spencer Strategic Management MARKS AND SPENCER GROUP PLC In September 2017 I took over as Chairman of M&S in the belief that, despite years of decline, a far-reaching turnaround . Jones, R. (2014, March 7). Continuous investment in the scheme has resulted in numerous Plan A products, a Plan A incubator for the development of sustainable products and services as well as the first UK ecofactory (European Commission, 2011). strong sales of joggers, leggings and pyjamas. M&S website temporarily suspended after leaking customers details. it still has more than 1,000 shops and employs more than 80,000 staff. It has markets in Europe, Far East . will add1,600 essentialclothing lines as well as more than 6,000 M&S food products. The company is losing key employees to its main competitors, including product developers, food technologists and General Merchandise design team members. In addition, with regard to the free movement of people, work visas or residence permits would be required for both UK citizens working abroad and EU workers employed in the UK. The M&S management is aware that they have a lot of work to do to fully get back in the game for which a radical shake-up is required from their end. Every business unit generally keeps a high number of product depending on the need of the customer. The strategic management empowers the organisations to endure in the competition of market. The companys new focus on providing customers with a superb experience including in the online sector on top of its High Street chains has enabled the growth of M&S.com in the last quarter of 2014 (Marks & Spencer, 2015). (2015). After a very successful run in the last 150 years, with 1,463 stores in 57 countries, M&S has run into major problems in all of its three departments, more so in food and clothing than homewares that have necessitated the need for some major changes in its business strategies and functioning. Following the appointment of Mark Bolland in 2010, the British retailer has accelerated a programme of making its supply chain more efficient by targeting $280 million in savings by 2020. There are various researches been undertaken on impression and insight, classification, decision making, recollection, approach, performance, transformation in outlook training and contentment level to read about the consumer behaviour. Marks & Spencer Company's Strategic Planning - 2977 Words - IvyPanda With the launch of the companys Plan A in 2007 and having won the GBS supply chain award for implementing a truly disruptive supply chain (Purt, 2012) the company is ahead of its competition as regards the social and environmental impact of its business. By analysing the existing business conditions. Further developments in this regards can present opportunities for the company (Brignall, 2016). (2015, February). It is one of the largest British retailers that sold clothes, home furnishings, food, gifts etc. The timing is certainly fortuitous as many of those who had never shopped online before may have been converted during lockdown. London: Marks & Spencer. However to achieve that spot they need to make there basic clear and should implement proper cost cutting methods and you might find them selling many other brands other then owned by them. In combination with the reduced buying power of the pound and with 1.1 billion in revenue coming from international markets, the company needs to put together a strategic plan on how the likely impact of Brexit can be minimised. Whilst this strategy led to a short-term decrease in sales, it resulted in a long-term increase in consumer confidence due to British customers preference and desire to seek both value and quality. The companys international expansion via franchise agreements gives it a strong competitive advantage compared with other UK businesses that trading only on the UK market (Rogers, 2012). (2014, February 18). M&S has said 365,000 of its existing customers had used its website for the first time during lockdown while another 315,000 had either tried it out or returned as shoppers. This includes things like using recyclable packing, sustainable resources, community investment and introducing healthy food choices with low calories. 1. The Telegraph. Think Innovation: How were encouraging innovation across M&S. For example: cost cutting this would enable the company to keep price of the products minimum and thus facilitating the customer. (2016). When it presented its latest annual results on 20 May, M&S split out its food and fashion profits for the first time, enabling some extremely revealing comparisons. This change involved concentrating on the three basic business values mentioned below: Marks & Spencer came up with a new promotional strategy that stressed on the term Your M&S. Getty Images By Mary-Ann Russon Business reporter, BBC News Marks & Spencer announced on Monday that it was bringing forward a plan to cut jobs due to the pandemic, with 950 roles set to go. Outbound logistics concerns the transport, storage and delivery of goods going out of a business. The company is utilising this trend by expanding its network of convenience stores, Simply Food, and planning the fastest food store opening programme in the history of the company in 2015/2016 (The Economist, 2015). In 2019, the company's total operating profit before adjustments was 726m. A SWOT analysis assesses the external environment and internal capabilities of a company (Harrison, 2015). The way to achieve is by re-taking the command of supply chain another of Marks & Spencers traditional strengths. Marks & Spencer: Quality worth paying more for. In the case of M&S, the company has placed considerable emphasis on its social agenda. Retrieved July 2016, from Marks & Spencer: http://corporate.marksandspencer.com/blog/stories/thinkinnovation-how-we%E2%80%99re-encouraging-innovation-across-mands%E2%80%99. The only beacon of solace can be found in the idea that M&S has largely suffered due to the pace at which business has changed in the last few decades rather than major functional or corruption problems from within. Yet, these attempts have so far not resulted in a desirable outcome (BBC, 2013). Working staff was having flexibility in there timings. An effective competitive strategy is critical. Retrieved July 2016, from Pestleanalysis: http://pestleanalysis.com/category/pest-analysis/. The retailer is midway through a reshaping of its store estate, closing small, dated and often poorly located high street shops and replacing them with modern out-of-town units and food-only stores. (2009). Marks & Spencer brand perceptions on the rise as it is rated one of the UKs top brands. M&S offers clothing, home products and luxury food products both in store and online (Marks &Spencer, 2015). Online sales remained flat in its financial year to March 28. teething issues as it shifted to a more contemporary style and fit in menswear. Any opinions, findings, conclusions or recommendations expressed in this material are those of the authors and do not necessarily reflect the views of UKEssays.com. Some of their larger high street units could also be repurposed as they have several big stores in key locations in city centres which would provide a variety of redevelopment options. Expert Blog: Marks & Spencer facing trading challenges before, during Introduction Between 2018 and 2019, the key economic indicators of Marks & Spencer (M&S) had demonstrated a downward tendency during the last year, namely from 10,698.2 million GBP of revenues in 2018 to 10,377.3 million GBP in 2019 and 10,181.9 GBP in 2020 (Marks & Spencer, 2020a). M&S has been affected by the recession and has seen a big slump in sales in 2009, a fouryear decline in its clothing sales and most recently, a ten-year low in its clothing sales in the second quarter of 2016 (Davey, 2016). As part of this decision, they made a commitment to hand back 2 billion to their shareholders. Further, clothing sales reached a ten-year low in Britain (Davey, 2016) and falling oil prices negatively impacted stores performance in the Middle East (M&S, 2016). Increasing terrorism attacks across Europe are also impacting consumer confidence and retail spending (Marks & Spencer, 2016). As every customer has his/her own taste, there should be variety with in the products. The important verdict is that M&S holds successful business strategies and market plans, the issue is that this value is not maintained by them instead some advantages have turned out to be a disadvantage for them. The former, once the flagship of the company, has suffered a considerable decrease in its market share over recent years and reached a ten-year low in terms of sales in the second quarter of 2016 (Davey, 2016). M&S is in a good strategic position to enjoy the benefits of an altering media landscape, the proliferation of social networks and a rising mobile wave. Huge variety of the products of all the brands and with in the different price ranges. Further listed are the main issues that were awaiting the management team of M&S, There was a lack of product variation it was a major issue since they got wedged up with the same product for quite a long it was the need of the hour to bring in a variety in the list of the product, To stand in and make a mark in this growing industry its essential to have an excellent relationship with the concerned customers. Marks and Spencer - Facing the Challenges Ahead - Kogan Page (2015). Porters model was designed and developed by Michael Porter in the 1980s to determine the competitive intensity and attractiveness of an industry (Spencer, 2015). (2014, September 1). (12 March 2008). Although the joint Clothing and Home catalogue will be discontinued, Marks & Spencer is committed to maintaining its e-commerce website: www.marksandspencer.com, as well as a Home brochure and a range of services including flower delivery. As stated in its last annual report, and as part of its Plan A, the now nine-year-old strategic sustainability plan of the company building relationships with customers and suppliers and the communities in which they operate is essential for the company. In the foods department, rivals like Aldi, Lidl, and Waitrose have upped their game with more varieties of foods at cheaper rates. Free resources to assist you with your university studies! The greatest of all the issues faced by the global supply chain is the sudden and ever changing preference and taste towards a particular product. Marks & Spencer plc is an iconic brand which has been trading since 1884 and is still considered one of the UKs top ten brands today (Vizard, 2015). Since M&S does not depend on any one particular supplier chain, its bargaining power in this regard has always been low. Marks & Spencer UK Stores M&S website http://corporate.marksandspencer.com/aboutus/where/uk_stores, M&S International Stores M&S website http://corporate.marksandspencer.com/aboutus/where/international_stores, Wal-Mart remains largest global retailer, according to Deloitte survey http://www.deloitte.com/dtt/press_release/0,1014,cid%253D196099,00.html. The retailer will add1,600 essentialclothing lines as well as more than 6,000 M&S food products toOcado'swebsite, after buying a 50pc stake in its retail business last year for 750 million. Zoe Wood @ zoewoodguardian Sat 2 Apr 2016 02.00 EDT Last modified on Sat 2 Dec 2017 12.59 EST He's the new king of the high street. Weakened consumer confidence and a decrease in the buying power of the pound have already had an impact on sales growth, whilst the decision is expected to affect the retailer in various other ways in future years. Annual Report and Financial Statements. In results for the year to April 2021, M&S said its Vangarde supply chain programme, launched in 2020, was now operating in around 350 stores. In its food sector, the company has introduced staff zoning across food halls and is increasing the number of staff in the store on an ongoing basis. Considering the operations like stock management, supply management, cash management & capacity management there were many risk or challenges associated with these processes which needed to be taken care by M&S team. Branding, it is a method which we implement in order to differentiate the multiple varieties of a product in terms of brand name, symbol etc. M&S has invested in a multitude of sub-brands, in-store bakeries and an improved in-store customer experience, thus meeting the changing needs of its consumers (Marks & Spencer, 2016). Selling space will be reallocated to higher growth product areas to maximise returns per square foot. In recent years UKs retailing industry has been facing fierce competition to keep their profits and recent sign of improvement growing in the course of strong opposition from companies like Tesco and its core retail operation. They are trendy and go along with market requirement. In their bid to leave no stone unturned, M&S has also tied up with Indian IT giant, Tata Consultancy Services (TCS) as a part of its 5-year plan. With this interest of the customer, we can make out the need in variation of each product. Purpose: This Impact Pathways paper aims to provide a timely and structured discussion of real-world problems at Marks & Spencer and in retail in general, evoked through the current COVID-19. Inferring from their half-yearly performance, sales were tight, especially in the food division. The Blockchain oriented ledger system enables all partners in the supply chain to verify information. It also intends to dispose of its two profitable US businesses, Brooks Brothers and Kings Super Markets. Marks & Spencer launches new website to replace Amazon platform. The companys legal environment and hence its legal department were paramount during the companys Simply Food chain expansion in 2007 and especially in allocating new store sites at BP petrol stations (Dry, 2007). Marks and Spencer plc was set up in 1884 in Leeds by Michael Marks and re-branded as Marks & Spencer (M&S) ten years later when a partnership with Thomas Spencer was formed. Available: http://www.examstutor.com/business/resources/companyprofiles/marksandspencer/strategyinsight.php Last accessed 30 Dec 2009, Peer Papers. The present business environment is very competitive in which every organisation is implementing strategies for their survival and growth. More importantly, their fashion range has also been plagued with the inability to cope with changing tastes, customer preferences and the variety that is available elsewhere. Basically Operation and Process Management is the activity of managing the resources and processes that produce products and services[4].. In addition, the recent Brexit vote is likely to have a substantial impact on the retailer in both its home stores and abroad. Waters(1999) states that to develop a competitive strategy, managers must look at the organizations strength and weaknesses in relation to those of its competitors. FOR OVER 135 YEARS OUR EXTRAORDINARY COLLEAGUES AND CUSTOMERS HAVE FACED. Further investments are being made in GM IT systems and a logistics network with the aim of delivering better supply chain flexibility and customer availability. Marks and Spencer Group PLC 's ( LON:MKS) first-ever loss is not a huge concern for the market as everyone is waiting to see whether the overhaul strategy will bear fruit. London: PricewaterhouseCoopers/TNS Retail Forward. If the staffs are technically equipped with better skills in sales and stock management it will definitely lead to higher sales and profitability. Macroeconomic factors and a weakening euro are still considered to be a challenge, especially in the Middle East (Marks & Spencer, 2016). Over the past twenty years it had introduced, and subsequently cut back, a plethora of sub-brands such as Autograph, Blue Harbour, Per Una, all of which has meant that M&S has had a very indistinct clothing positioning at the very same time that younger customers were also turning to etailers such as Asos and Boohoo, while John Lewis, one of M&Ss traditional rivals, invested heavily in multichannel during the credit crunch and emerged stronger afterwards as an online player. Increase franchise space. The week ahead in business and finance. Our academic experts are ready and waiting to assist with any writing project you may have. Major Issues Challenges Facing The Mark Spencers Marketing Essay TaylorWessing. It is very difficult for a company to compete successfully in the long run based just on operational effectiveness. M&S has also fallen under the domino effect of the shutting down of retail chain stores like Toys R Us, New Look and Maplin due to their inability to maintain pace with the changing market structure. Analyse PESTEL for Monitoring your Business or Organization. Back in 1998, clothing, footwear and gift sales accounted for almost two thirds of revenue, with food around one third, whereas just over two decades later these non-food and food shares of total M&S sales have completely reversed. In spite of being an appreciated brand in UK as well as in Europe they are confronted with various impending problems. Marketing mix is technically composed of product, price, place and promotion which is also popularly known as 4Ps. Marks & Spencer is to cut 950 jobs in a retail management shake-up marking the first phase of a major transformation programme. Challenges faced by marks and spencer - UK Essays If some product is not getting sold, then it means there is a time to make variation in that product. But a return to the former dividend level seems possible. The customers wont see any difference, whether they own or rent the property in which they operate. 50% of John Lewiss sales are made online compared to just 20% of M&S clothing and home sales. M&S: doing the right thing leads to change - for the better The best part of M&S is that they are having a clear picture of its performance objective, although in between they got deviated from its path. Retailing 2015: New Frontiers. The companys 914 UK stores 222 owned and 349 franchises of Simply Food stores as well as the 302 full-line clothing and home stores and an e-commerce platform with over seven million registered users serve 33 million customers in two divisions (food and general merchandise) with a revenue of 5.2 billion and 4.0 billion respectively. (2016). The company has reported that food sales are up 10.4% since September 2019, with food operating profit before adjusting items of 143.7 million. A general overview of Marks & Spencer is followed by a PESTEL analysis which offers a comprehensive look at the companys strategic business environment. Fashion Retail 2016: The future of fashion retailing in a digital age. Conversely, they have experienced strong sales of joggers, leggings and pyjamas. LONDON, May 21 (Reuters) - Britain's Marks & Spencer (MKS.L) is set to report on Wednesday a 90% slump in full-year profit after the COVID-19 pandemic hammered its clothing sales. We operate as a family of businesses, selling high-quality, great-value, own-brand products and services, alongside a carefully selected range of third-party brands. What were the challenges faced by Marks and Spencer in the competitive environment. Marks & Spencer : ANNUAL REPORT 2020 | MarketScreener Demand used to be covered with in the time constraint. Strategy of Marks and Spencer to Improve Performance. report. Marks and Spencer Group plcAnnual Report & Financial Statements + Notice of Annual General Meeting 2020. Welcome to the M&S merry-go-round. Last accessed 30 Dec 2009. This doesnt mean that they will be selling or closing stores. The equivalent earnings on clothing were down 37% to 224 million on sales of 3.2 billion. At the other end, fashion brands such as Zara, H&M, Gap and Next are targeting younger, fashion-oriented clientele with their latest fashions and affordable prices. These changes in the competitive landscape of UK fashion retailing would cause problems for M&S who were at the same time losing touch with their customer base and new consumer behaviors. In addition, in 2009 the company set annual recycling targets (Waste Management Word, 2010) and in 2012 achieved zero waste to landfill (Russell, 2012). The main focus of was to established there business in UK as it was the hub from where they started their business. Also, with the falling income, M&S is also faced with high debt. Retrieved July 2016, from The Telegraph: http://www.telegraph.co.uk/finance/newsbysector/retailandconsumer/10647939/Marks-and-Spencerlaunches-new-website-to-replace-Amazon-platform.html, Vizard, S. (2015, July 15). From simple essay plans, through to full dissertations, you can guarantee we have a service perfectly matched to your needs. younger customers were also turning to etailers, invested heavily in multichannel during the credit crunch. Marks and Spencer needs to prove itself with overhaul strategy Generation X women experience age in seven different ways according to a new study by Nottingham Business School (NBS), part of Nottingham Trent University.
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