Historical background of marks and spencer


Marks & Spencer Plc started in a stall in 1884 by Michael Marks in a Leeds market after which he was joined by a partner Tom Spencer. They both had a reputation of selling only British made goods in the 20th century, a policy discontinued in 2002.Marks & Spencer Plc is seen as the British Retailer that sells clothes, gifts, home furnishing and food formerly under the name of St. Michael but rebranded as Marks & Spencer in United Kingdom, Europe, Far East and the Americas. Marks & Spencer Plc has made itself widely known in the UK with over 450 stores and its largest store at Marble Arch, London.

By 1975 they had moved to Europe and Canada where they are fully established. Marks & Spencer Plc which initially functioned under the name St Michaels had an unlimited time period on their return policy as long as the customer could produce a receipt, this policy was later reviewed to 90 days in 2005 and a further review to 35 days in 2009. Marks & Spencer Plc returns policy is seen as the most generous on the British High Street. By the end of the 1990s Marks & Spencer Plc had a problem as their profit plunged because of the rising cost of using British Suppliers as rival retailers were importing their goods from lower cost countries and also because of the fact that Marks & Spencer Plc did not accept other credit cards except their store cash cards amongst a host of other reasons. During their downturn period, Marks & Spencer Plc refused to budge in switching to overseas low cost suppliers as it was seen as a n act which undermined a core part of its appeal to the public. All these factors constituted to Marks & Spencer Plc sudden slump which caught the company, its shareholders, retail stores and the general public by surprise as not only did their share price fall more than two thirds of the original market price so also did their profit.

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In 2001 with drastic changes in its business focus such as accepting other credit cards, introduction of new range like per una , indigo etc, reengineering of its business model and strategy, restructuring and redesigning their store, providing adequate changing room etc, Marks & Spencer Plc fought its way back into the UK market.

Source: http://corporate.marksandspencer.com/aboutus/ourhistory


1.1 Importance of external factors [P1]

External factor plays a very important role in Marks & Spencer Plc. No organisation can escape from the external factors of a business. It is the key that drives helps focus on what is most important to explore the different ways in which the business environment might change. These external factors are Political, Economic, Social Culture, Technological, Environment and Legal. This is known as the PESTLE ANALYSIS.

The external factor helps to know and under study the political factor the company is operating in.

The external factor helps to know the social life style of my customer.

The external factor helps to know the technological situation I find myself inn.

The external factor helps the organisation to understand the business environment

It also helps the business to understand the business circle, exchange rate, economic growth rate etc.

It also helps the business to know more about the legal standard of the economy such as health and safety, legislative constraints etc.

It helps the business to understand and know their competitors

The external factor also helps the business to understand the social influences such as changing culture and demographics

Business that looks on the solution of the external factors will run its business properly.

Oxbridge writers on Marks and Spencer corporate objectives: Full text [online]

http://www.oxbridgewriters.com/essays/marketing/marks-spencers-corporate-objectives.php [END OF P1]

1.2 The needs and expectation of stakeholders [P2]

A stakeholder is any person, group or institution that has an interest in an activity or project. This definition includes intended beneficiaries and intermediaries, winners and losers, and those involved or excluded from decision making processes. (Bryson 1995)

The stakeholders who have got an interest in Marks and Spencer are:

Their banks, Shareholders, Employees, Customer, Suppliers

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Stakeholders Needs of stakeholder Expectations

Customers To provide good customer services

To provide low price

To provide good product

To provide local source of product Provide community program

Customer loyalty

Promotion and activities

Employee To provide pay raise

Job retention

Job training

To provide a comfortable working environment Give bonus

Provide education

Rotation of job

Shareholders Provide adequate communication

Increase in share prices

Increase in dividends

To keep them informed Good turn over

Good return on investment

Banks Inflow of cash Loan lending

Suppliers Increase in supplies

Local sourcing of product Turnover increase

Want to sell goods in volume at good prices.

Source: By student from lecturer lecture note

Managers need to be conscious of the financial impact on various stakeholders of the strategies they are pursing or planning to pursue. They also need to understand how the capability to meet these varied expectations could enable the success of some strategies whilst limiting the ability of an organisation to succeed with other strategies. [END OF P2]

1.3 Major change taking place in the external environment [P3]

Political situation:

The government plays a very important role within the operation of manufacturing these productions in terms of regulation. There are potential fines set by the government on companies if they do not meet a standard of laws. The changes in laws and regulation, including changes in accounting standards, taxation requirements,(including tax rate, new tax laws and revised tax interpretations) and environment laws in domestic or foreign regulations e.tc. This law has affected Marks and Spencer in different ways especially in the increase in Vat. This will increase the prise of their product and reduce the market sell of their product.

Economic situation:

The economic plays another important role in the business. However, things changed. Most economists loosely define a recession as two consecutive quarters of contraction, or negative GDP growth. Marks and Spencer s customer don t spend allot anymore instead there save their money. The ongoing recession has brought down their market sale and put them in a stage of looking for a better strategy to fight the recession.

Social situation:

Many people are practicing new lifestyles in the economy. The social culture of an environment can affect Marks and Spencer in a different ways. The government are cutting down medical budget. In this case, they are trying to educate allot of people to do exercise and those from the age of 37 to 55 will also increasingly concern with nutrition. Majority of the people are now looking after their health and doing much exercise to slim their body down. So this has affected Marks and Spencer because they will need to get better and fitted cloths for their customer to make sure there meets up their customer expectation.

Technological situation:

This can also affect the business especially now most organisation are introducing the online services, home delivery, virtual sales etc. This will reduce Marks and Spencer sales because it will depend on how fast the organisation will deliver a customer goods that will encourage the customer to be more attracted to them .And even where they have alot aged; most of the worker won t be able to operate this new technology. They will have to go through training process and this will cost the company to spend more. Most of this technology can be misused and might cause problem in the company.

Environment situation:

Studying the environment is another important way to prevent some environmental problems like, weather, transport problems, competitive problems, customer choices, customer queries etc. Marks and Spencer always make sure they are in the right position to provide for the customer the best services ever. Changes in weather affect seasonal products of Marks and Spencer so they always try to find the best strategies to make sure their goods are been sold out at a particular season.

Legal situation:

This can also affect Marks and Spencer in term of adjustment of the legislation. But the company try to make those changes in a way that their customer will be retain and their services will be increase.

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Sources: Morrison, M (2008) Pestle Analysis. CIPD Factsheet.RapidBi

Marks and Spencer (2010) investor s Full text [online] http://www.marksandspencer.com/



2.1 The current position of Marks and Spence [P5]


Product: The company offer stylish, high quality, great value clothing and home product, as well as outstanding quality foods. Political: This is an important factor that drives the strategic of many organizations to change. The change of constitution of politics affects the strategic of an organization. The changes of government affect the strategic of organization to change. The shift of political power from government to global organization affect the organization affects the organization strategy. Many organizations always try to change their strategy to fit the political view of the economic.

Staff: The company provide good staffs that help improved the customer services. They also retain their staffs and provide them with training that will increase their services toward their customer. Economic: This concerns the financial structure, objectives and constrains place upon the organisation. This relates to both the external(that is, the levels of profit and turnover generated and the extent to which this is viable and able to sustain current and envisaged levels of activity)

Market: M&S have a high interest in the market. They always try to provide the best customer service and provide the best quality product that will enable them to gain competitive advantage. Social culture: This is another important factor that the organizations need to look into properly. The way the people lives, expectations, pattern of work, job, occupation and career patterns, changes in patterns of earnings etc. The social lives of most economy changes every year and organizations need to set up new strategic that will suite the social life of the economy.

Promotion: Marks and Spencer introduce a promotion to keep their customer happy and to gain more customers. Technology: This factor affects the social, economic and business activities. Rendering many occupations and sectors obsolete; creating new occupation and sectors, opening up new spheres and location of activity. Organization should make sure there have the right technology to improve the organization works.

Price: M&S provide the best price to their product to gain competitive advantage. Environment: this is looking at what is happening within the environments where M&S operate.

Place: M&S is located in a nice place where their customer can get a good car parking and quicker way to shop. Legal: this is looking on the changes in the legislation and how it s affecting M&S. that is, the employment, access to material, quotas, resources, import/exports axations.etc.

People: M&S also provide the best people that will serve the best customer service to keep their customer happy. A good customer approach is very important in any business environment.

Marks and Spencer (2010). Full text [online]



2.2 The strength and weakness of MARKS and SPENCER [P6]


? Strong balance sheet

? Increase in turnover and trading profit

? Strong cash flow position

? Good human resources

? Brand awareness

? Leading premium quality food retailer OPPORTUNITIES

? Capability to turn resources into advantages

? Market shift to globalisation

? New product

? Customer demands changes to more value for money

? Diversification

? Develop overseas supply chain


? Perception on high price

? Customer disinterest

? Environment issues(pollution)


? New and existing competitors

? Economic recession

? New legislation volatility of raw material

? Takeover bids

? Market shift to globalisation

? Low cost retailers

Source: Marks and Spencer http://corporate.marksandspencer.com/home


2.3 Tools used to analyse the effects of the current business plan [P4]

? Ansoff growth matrix

? Value chain

? BCG matrix

? Core competences

? Porter generic matrix

? Porter 5 forces

? Product life circle

? The gap analysis

? Marketing Mix

The Ansoff s product/market matrix

Existing Product New Product

Market Penetration

Product Development

Market Development


The Ansoff growth matrix can be used to identify directions of Marks and Spencer strategic development. The Ansoff growth matrix provides direction for strategic option available to M&S in terms of product and market coverage.

Market penetration is the name given to a growth strategy when a business focuses on selling existing products into existing markets. And these penetrations seek to achieve increasing the market share of current product, i.e. by combination of competitive pricing strategies, advertising, sales promotion and perhaps more resource dedicated to personal selling. This has help Marks and Spencer to secure dominance of growth markets. It restructures Marks and Spencer market by driving out competitors and it also increase patronage of their existing customer.

Market development is the name given to a growth strategy where the business seeks to sell its existing products into new markets. Marks and Spencer has develop their market in so many different ways by providing a new distribution channel, new product dimensions or packaging, new geographical markets (for example exporting the product to new country), different pricing policies to attract different customers or create new market segments.

Product development is the name given to a growth strategy where a business aims to introduce new products into existing markets. Marks and Spencer brought up a strategy that may require the development of new competencies and requires the business to develop modified products which can appeal to existing markets.

Diversification: Marks and Spencer has diversified alot to introduce new products into new markets. Even as there are more risks in it but they still get the right strategy to win their competitor who was there before them


Porter explains that there are five forces that determine industry attractiveness and long-run profitability of M&S and the food retailing industry

Threat of new entrants: The new entrants to an industry can raise the level of competition. The threat of new entrants largely depends on the barriers to entry and the market is also sensitive to reputation. The key barriers to entry include; the economics of scale, capital investment requirement, customer switching cost, access to industry distribution channels. In Marks and Spencer business line, the threat of new entrants is easy and high but the most important issues is to win your competitors and maintain the business.

Threat of substitutes: substitute product can lower industry attractiveness and profitability because they limit the price level. The threat of substitute product depends on buyers willingness to substitute, the relative price and performance, the cost of switching to substitute. In Marks and Spencer the threat of substitute s product is low because majority of the customer who have been with them for a very long time enjoy their products and are still enjoying it.

Bargaining power of suppliers: suppliers are very important in a business. They supply the company with raw material and other product. The cost of the item bought from supplier can have a significant impact on the organisation profitability. If the supplier has high bargaining power over the organisation, then the theory industry is less attractive. The bargaining power of supplier will be high when there are many buyers and few dominant suppliers, also when there are high valued product, when the supplier threaten to integrate forward into the industry (example brand manufacturing to set up their own retailer outlet), when the buyer does not threaten to integrate backward into supply

Bargaining power of buyers: These are people who create demand in the organisation. The bargaining power of buyer is greater when there are few dominant buyers and many sellers, when the product are standardised, when the industry is not a key supplying group for buyer. In Marks and Spencer, the bargaining powers of buyers are not great

Intensity of Rivalry: This will depend on the structure of the industry cost, the structure of competition, degree of differentiation, switching cost, strategic object, exist barriers. There are alot of competitor surrounding marks and Spencer but their customer still remain with them because of their old time being.

All works above sources:

Porter,M.E.(2008) How competitive forces that shape strategy, Harvard business review, p86-104.


Task 3

3.1 The modelling tools to develop strategic option are [P7-8]

? Ansoff growth matrix

? Value chain

? BCG matrix

? Core competences

? Porter generic matrix

? Porter 5 forces

? Product life circle

? The gap analysis

? Marketing Mix


Micheal porter suggested four generic business strategies that could be adopted in order to gain competitive advantage.




Cost focus

Cost leadership

Narrow Broad

Scope of business activities

Strategy Differentiation: This strategy involves selecting one or more criteria used by buyer in a market-and then positioning the business uniquely to meet those criteria. This strategy is usually associated with charging a premium price for the product- often to reflect the higher production costs and extra value-added features provided for the consumer. Differentiation is about charging a premium price that more than covers the additional production cost, and giving customer clear reasons to prefer the product over other, less differentiated products. The Price of Marks and Spencer products are cheap compare to Tesco and Asda that have very cheap prices on the product. But yet Marks and Spencer customer still remains because to the quality of their products.

Strategy-cost leadership: with this strategy, the objective is to become the lowest-cost producer in the industry. Many (perhaps all) market segments in the industry are supplied with the emphasis placed minimising costs. If the achieved selling price can at least equal (or near) the average for the market, then the lowest-cost producer will (in theory) enjoy the best profits. This strategy is usually associated with large-scale businesses offering standard product with relatively little differentiation that is perfectly acceptable to the majority of customer. M&S by cheap product/ clothing line and sell in a cheap price to meet competitors.

Strategy- differentiation focus: in the differentiation focus, a business aims to differentiate with just one or a small number of target market segments. The special customer needs of the segment mean that there are opportunities to provide products that are clearly different form competitors who may be targeting a broader group of customer. The important issue for any business adopting this strategy to ensure that customer really do have different needs and wants. Marks and Spencer also deal on the older market (45-65 of age) which makes them different from other retailer shops like Tesco and Asda. They also used their brad to meet the needs of the olds.

Strategy-cost focus: Here a business seeks a lower-cost advantage in just on a small number of market segments. The product will be basic- perhaps a similar product to the higher-priced and featured market leader, but acceptable to sufficient consumer. Such products are often called me too

The Micheal Porter generic strategies are been used in many organisations including Marks and Spencer, either become the lowest cost retailer or different product and services in such a way that its valued by customer to the extent that they will pay a premium price. By Appling this strength in either a broad or narrow scope, the four generic strategies result: differentiation focus, differentiation, cost focus, cost leadership. Mark and Spencer core products are foods and clothing and it implement a focus generic strategy as it concentrate differentiation from Tesco, Asda, BHS, Top shop etc.

Source: Porter,M.E.(2008) How competitive forces that shape strategy, Harvard business review


The marketing mix is very important in an organisation. This is the elements that are associated with the product(s) that affect whether the consumer decide to buy or not. They are four main factors that will decide if a consumer wants to buy or not.

Prices: Marks and Spencer charges premium prices through its differentiation strategy.

Product: Marks and Spencer markets its product based on superior quality and reliability.

Place: Mark and Spencer products are sold through its large numbers of stores in city and town centres. M&S has also expanded in sales and distribution channels through internet via it website (online shopping)

Promotion: M&S integrated marketing communication is delivered through media in various form, advertising, TV, national newspaper and magazines as well as website

[END OF P7-8]

3.2 Option to form the basis of future organisation strategy [P9]

Having analyse this models one which I believe would be able to help the company will be

The Ansoff s product/market matrix

Existing Product New Product

Marks and Spencer

Market Penetration

Marks and Spencer

Product Development

Marks and Spencer

Market Development

Marks and Spencer


The Ansoff growth matrix can be used to identify directions of Marks and Spencer strategic development. The Ansoff growth matrix provides direction for strategic option available to M&S in terms of product and market coverage.

Under the market penetration, M&S provide a good and quality service that has driven the organisation into a large market penetration.

Marks and Spencer now introduce a product development by increasing the quality of their products and developing their product to enable them to develop their market.

The market developments have also encouraged marks and Spence to employ the right staff with the right skills that will help reach the company objectives and achieve the organisation goals.

Marks and Spencer diversification has also help the organisation in different ways. They started with cloths, and move to foods and drinks. The diversification has also enabled the organisation to stand up to their feet again and push forward to gain their goals.

I will fully recommend the Ansoff matrix for marks and Spencer as they have been using it already in gaining in market penetration and development. [END OF P9]

3.3 Stakeholder mapping [P10]

A stakeholder is any person or institution that has an interest in an activity or project. This definition includes intended beneficiaries and intermediaries, winners and losers, and those involved or excluded from decision making processes. There are different ways in which stakeholder mapping can be used to gain an understanding of stakeholder influence. The approach to stakeholder mapping here identifies stakeholder expectations and powers and helps in understanding political rarities. The stakeholders who have got an interest in Marks and Spencer are: Their banks, Shareholders, Employees, Customer, Suppliers

Level of interest

(A)Meet their needs

Increase their effort

Increase their level of interest

(B)Key players

Educate them on the company

Engage and update the regularly

Involve them in decision making

(D)Least important

Keep informed

Try to communicate

Let them know of any change


Show consideration.

Keep informed

Participate in the company

Try to increase the level of interest.

Source: computed by student from lecture note

Stakeholder mapping might help in understanding better some of the following issues:

In determining purpose and strategy, which stakeholder expectations need to be most considered?

Whether the actual levels of interest and power of stakeholders properly reflect the corporate governance framework within which the organization is operating.

Who the key blockers and facilitators of a strategy are likely to be and how this could be responded to- for example, in term of education.

Whether repositioning of certain stakeholder is desirable and/or feasible. This could be to lessen the influence of a key player or, in certain instances, to ensure that the key players who will champion the strategy.

Source: Bryson,J.M (2004) Stakeholder Identification and Analysis techniques. Minnesota. Rouledge

[END OF P10]


4.1 Criteria for reviewing a strategy are: [P11]

? Feasibility

? Suitability

? Acceptability

? Cost effectiveness

? Interest of other stakeholder

? Customer

? Competitors

? Nature of the product and services

Customers: The customers of Marks and Spencer are very important to the organisation. M&S customers find it hard to shop at another retail shop because of the old time relationship with the organisation. Customer satisfaction is very important to the organisation and M&S always make sure that they provide the best customer services to their customer especially the aged.

Interest of other stakeholder: the stakeholder is another important strategy M&S love to use. The interest of their stake holders is how to develop and plan for the organisation growth. They love to stay close the stake holders, give them the right information there need to know and provides them with updated about the running of the organisation.

Competitors: Marks and Spencer love to look at their competitor so as to get the strategy they are using and try to provide a better strategy to over shadow their competitor strategy. Competitors have been a big issue for Marks and Spencer and the always try to make their products as cheap like their competitor to attract more customer and to keep the own customer happy with no complains.

Nature of the product and services: The nature of the product and services is always at a high level because they provide good quality products to their customer to show a differentiation between them and other competitors. They services they provide to the customer are very much enjoyable because they are always there to help u out and show u the best product u needs to have.

The strategy plan for MARKS and SPENCER ARE [continuation of P11]


Source: From Marks and Spencer s Website 15/04/2002


100% OWN BRAND: The company will return to selling only own brand products and brands exclusive to marks and Spencer so it can guarantee customers the quality, value and service they have come to expect. Central to the recovery plan is the delivery of significant improvement in product appeal, availability and value thereby rebuilding the relationship with core marks and Spencer customer.

IMPROVED SEGMENTATION OF CLOTHING: Marks and Spencer will concentrate first on regaining the loyalty of core customer, who prefers classically stylish clothes. This is the priority. The company has plans to regain the confidence of its customer in the quality and fit of its clothing. It will sharpen price by rebalancing the price architecture, extending the range of entry-price merchandise and communicating this clearly to customers.

BUILD ON SUCCESS IN FOOD: Marks and Spencer a food continues to perform well and has earned customers trust for providing quality, innovation and convenience. The business is a key platform for future growth and the company is considering opportunities to expand its reach through new locations and selling channels.

DEVELOP HIGH-GROWTH AREAS OF HOME AND BEAUTY: the home business is growing strongly, with home furnishings and gifts the fastest growing product areas. Beauty, albeit relatively small, is also growing rapidly. Both of these areas offer promising opportunities for development and will be expected.

ACCELERATE STORE RENEWAL PROGRAMME: Mark and Spencer will accelerate the rollout of the successful elements of its new concept format under a plan to refurbish more stores faster and at lower cost. Two thirds of its retail space (120 stores) will be completed by the end of the coming financial year, benefiting the majority of Marks and Spencer s customers.

MORE INTENSIVE USE OF SPACE: Selling space will be reallocated to higher growth product areas to maximise returns per square foot. In total, 600,000 sq ft will be reallocated within the year to areas such as the new clothing range supplied by George Davies, Home, 50 new Beauty shops, and 30 new coffee shops.

IMPROVE THE SUPPLY CHAIN: The Company continues to see substantial benefits from the reconfiguration of the supply base, being shown in a clothing primary margin that is rising strongly. The priorities now are to eliminate duplication and increase transparency. By re-establishing closer working relationships with its supply partners, historically and unique strength, marks and Spencer will achieve further improvements in quality, value, product appeal, and availability.

Financial Services: Plans for the future include developing the Marks and Spencer store card as an essential partner to the growth of retail sales; a stronger presence for financial services in stores; continued growth of the credit business; and faster rates of growth of non-credit areas, which may involve bringing in external partners.


In order to focus all its efforts on the recovery of the UK business, Marks and Spencer intends to divest or close non-core businesses and assets, subject to consultation with its employees.

International: The Company intends to close its loss-making business in continental Europe, affecting some 3,350 jobs, subject to consultation. It also intends to dispose of its two profitable US businesses, Brooks Brothers and King Super Markets. These operations do not provide an appropriate platform for future international expansion by Marks and Spencer.

The company s 10 stores in Hong Kong will be sold to become a franchise. Our franchise business, spanning 30 countries and operating with appropriate formats and strong local partners, continue to be successful. The company s business in the Republic of Ireland is also growing fast and profitable. Marks and Spencer remains firmly committed to these businesses, recognising the importance longer term of international development.


Property: To reduce the dilution from the relatively low returns from property investment, Marks and Spencer intend to release value from almost half of its extensive property portfolio ownership of stores in prime locations will be retained to maintain maximum operational flexibility as well as capturing future increases in capital value.

Improve Capital Structure: To create a more efficient capital structure and improve the potential for a faster rate of earnings growth Marks and Spencer intends to return 2 billion to shareholders by the end of March 2002. Following the return of cash to shareholders, Marks and Spencer will retain the financial strength and flexibility to fund future growth.

Source: http://www.examstutor.com/business/resources/companyprofiles/marksandspencer/strategyinsight.php

[END OF P11]

4.2 Construct a strategy plan that include resource implication [P12]

Current significant issues affecting M&S include political issues, competitors, customer, social factors, legal changes, market share changes, environmental issues, culture e.t.c. their competitor is one of the big issues affecting them. Organization like Tesco and Asda provide a cheap products and services to enable the win the majority customers but M&S always used the better strategies to over shadow them. Also the political changes have affected Marks and Spencer in term of increase in VAT rate, job cutting, reduction of budget e.t.c. the prizes of most goods are increasing and customer find it hard to spend more.

Where do we want to go (objectives?)

Here Marks and Spencer have to look at setting the right objective to enable them to meet their vision.

Cost of raw material: Nowadays the cost of cotton has gone up so the prices of most goods have also increase and it will affect the organization.

Cost reduction major with three years: To enable Marks and Spencer to gain a high market share, they have to reduce their cost so even if they add the VAT it won t have an effect in their profit.

How do we get there (strategy)

Marks and Spencer have to get the right people to set the right strategy for the organization to grow more. This has to do with the cost reduction process, 50% off sales, good customer services.e.tc.

Which way is the best possible means (tactics)

Marks and Spencer used good strategy like the improved in segmentation of clothing, 100% own brand, build on success in foods, develop high growth areas of home and beauty, more intensive use of spaces, improved their supply chain.e.tc. These tactics has help M&S to work toward achieving the organization objectives.

Activities and action plan/ implementation (activities)

Marks and Spencer fist year plan is to total focus on the UK retail, their second plans is to value realization and closure of loss-making business, and the third year is to change the capital structure.

Activities/Years Year 1 Year 2 Year 3

Total focus on UK retail.

Value realization and closure of loss-making business.

Change the capital structures. Source: computed by student from lecture note

How will we monitor the process (control?)

Marks and spacer have to look toward achieving their objective and gaining market price by looking at the resources which are

Physical Resources:

The physical resource is always the company reputation. The physical resources help the organization to stand and grow gradually. The physical resource can be the company equipments, vehicle, building, reputation. Etc. Marks and Spencer should make sure that their physical resources are always available. If they fail to provide their physical resources, this may affect the company noncurrent assets of the organization.

Financial Resources:

This is very important. Resources Mark and Spencer should look into and provide the best quality goods. The financial resources have bring down allot of companies and most company always try to keep up with their financial resources. Mark and Spencer should look at the cost of training, redundancy costs, relocation costs, new buildings, and refurbishment of existing building. The company that fails to look into the above mention before taking action might end up losing their market share.

Human Resources:

Marks and Spencer have to be aware of their human resource to enable them achieve the objective and provide the best customer serves. Marks and Spencer have to look at their restricting, interviewing, hiring, redundancies, training, lay off, retention, and customer health and safety. If there fail to look into the following, the company might fail to achieve their goals and may lose allot of customer.

Source: http://corporate.marksandspencer.com/aboutus/student_info

[END OF P12]

4.3 The impact of the strategy and objectives on the business plans: [P13]

Ethical: M&S has different ethnic workers from different background. So communication between the workers and customer might be abit hard for some of the workers and this has affected them.

Cultural: the culture of M&S like flexible working hours, supporting working parents, gives advice e.t.c. has affected them in some areas where they are short of short of staffs ,The organisation need to employ people to cover up the space of staffs that are on antenatal leave to provide better and quick services.

Environmental: The environment for example the recession, increase in VAT, cut of budgets, cuts of jobs has put Marks and Spencer into working toward finding the right strategy for the present economy. The ongoing recession has brought down their market sale and put them in a stage of looking for a better strategy to fight the recession.

Social: The social culture of an environment has affect Marks and Spencer in a different ways. The government are cutting down medical budget. In this case, they are trying to educate allot of people to do exercise and those from the age of 37 to 55 will also increasingly concern with nutrition. Majority of the people are now looking after their health and doing much exercise to slim their body down. So this has affected Marks and Spencer because they will need to get better and fitted cloths for their customer to make sure there meets up their customer expectation.

Businesses: These include other little new retail business that is developing. The rate of competitors is increasing and it s affecting the organisation.

Source: http://corporate.marksandspencer.com/aboutus/student_info

[END OF P13]

5.1 The appropriate vision and mission statement of the organisation are: [P14]

Marks and Spencer have over 600 stores located throughout the UK, ranging from large out of town and flagship stores of over 100,000sq ft. simply food stores of around 7000 sq ft.

A vision statement is sometime called a picture of the organization in the future but it s so much more than that. The vision statement is the organization inspiration, the framework for all the organization strategic planning. The vision statements answer the question, where do we want to go ?

The Mission statement is the essential purpose of the organization, concerning particularly why it is in existence, the nature of the business it is in, and the customer it seeks to serve and satisfy.

A strategy is the mean by which organization meet, or seek to meet, objectives. There can be a strategy for each product or services, and an overall strategy for the organization.


To be the standard against which all other are measured


To make inspirational quality accessible to all


Quality, value, services, innovation and trust

Marks and Spencer also outlines its corporate social responsibility in its mission statement and consider the needs of other stakeholder too. They want to continue its differentiation strategy by delivering freshness, quality and innovation.

Source: http://corporate.marksandspencer.com/aboutus/student_info

[END OF P14]

5.2 Objectives of Marks and Spencer [P15]

Profit maximisation: maximising profit this is very important in every business organisation. Marks and Spencer provide the right strategy to maximise the profit of the company. Profit maximisation can be achieved where the differentiation between the total revenue earned by the business from selling its product and the total cost of the product is the greatest.

Increase sales: This is another important objective that also leads the organisation toward achieving its objectives. Every organisation employs the right people with the right skills to provide the right strategy to increase their sales.

Market Leadership: this is what most organisations want to achieve. Mark and Spencer have set up the right strategy and have employed the right people to enable them to be the leader in the market.

Growth: Growth is another important objective for an organisation. Organisation without any growth will always remain in the same spot and will someday liquidate. The managers of Marks and Spencer always make sure they provide the right strategy that will enable the organisation to grow into a maturity stage.

Offering high quality service: M&S offer very high quality goods and services that will make their customer happy. Customer satisfactions are very important to an organisation to enable them to achieve their objectives.

Rewards to shareholder: M&S also give reward to their shareholders and provide them with information to keep them updated.

Aims and objectives of all business are to help them to achieve and reach their targets and to make their business successful. M&S aim to put their customer first in anything they do. They also provide a high quality goods and services that will make their customer happy.

Source: http://corporate.marksandspencer.com/aboutus/student_info

[END OF P15]

5.3 Measures of evaluating a strategic plan of Marks and Spencer [P16]

The organisation has objective which are achievable

Marks and Spencer has set up a big plan that will enable them achieve their objective. They started with 100% own brand, improvement of segmentation of clothing, build on success in food, develop high-growth areas of home and beauty, accelerate store renewal programme, more intensive use of their space, improve the supply chain and financial service. All the above mention was achieve and Marks and Spencer has been successful since 2002.

Is the plan working within the budget?

Mark and Spencer have always set up their plans together with their budget. The organisation makes sure their plans meet up with their yearly budget. They management of the organisation works toward setting up their yearly plans and make sure that the organisation work within their yearly budget to enable them reach their objectives.

Did the plan considered the stakeholder need (internal, connected, and external stake holders?)

The stakeholders of Marks and Spencer are very important to the company. The stakeholders are always updated about any plan that is going to take place. Their stakeholders will be informed both the internal, connected, and external stakeholders of the organisation. And the organisation will expect to hear from them before taking any further actions on their plans. This will keep their stakeholders happy with their plans and how they are running the organisation.

Does the plan have room for contingencies?

Marks and Spencer s plan are always in action. Management make sure their plans are well set and taking into action to improve the organisation growth.

M&S Corporate Profile (online) available at


[END OF P16]


6.1 Schedule for implementing a strategy plan for Marks and Spencer [P17]

Gantt chart

Activities/Years Year 1 Year 2 Year 3


Total focus on UK retail.


Value realization and closure of loss-making business.


Change the capital structures. Source: computed by student from lecture note

On their first plan, Marks and Spencer want to focus on the UK retail so ask to develop those areas that need to be improve to gain more market share and this will go through the first year, second year and then into the third year to make sure that their retail store are very much improved.

On their second plan, Marks and Spencer want to value realization and close down all their loss making business so as to enable the company to stand strong and focus on the profit making business. The plan will take effect on the second year so as to help them in the development of their retails store and other profit making business.

On their third plan, Marks and Spencer want to change their capital structure. To create a more efficient capital structure and improve the potential for a faster rate of earnings growth Marks and Spencer intends to return 2 billion to shareholders by the end of March 2002. Following the return of cash to shareholders, Marks and Spencer will retain the financial strength and flexibility to fund future growth. [END OF P17]

Task 6b

6.2 Marks and Spencer dissemination of information about the specific plan to stakeholders [P18]

1. Attending meetings

2. Report

3. Public relation activities

4. Organisation news select

5. Conferences

6. News release (Articles)

7. Social net working site

8. Advertising

9. Annual report

10. Notices boards

11. Web site.

Attending meetings: Meetings are one of the easiest ways of passing information to their stakeholders. Marks and Spencer send messages to their stakeholder through their media informing them about their oncoming meetings. Their meetings are been held and the managements will now inform their stakeholders the organisation improvement and intention.

Web Site: The organisation web site is another way of passing information to their stakeholders. If the organisation wants to share information, they just updated their web site and past all information they want to share to their shareholder. The web site is another easy way of sharing information to the organisation stakeholders.

Notices board: There notices board can be another way of sharing information with their stakeholders. The notices board is always updated with the organisation intention, past news, results, public view, Job vacancy, organisation development, organisation ideas toward helping their stakeholders. e.t.c. This can be share with both the internal, connected, and external stakeholders.

Annual Report: Marks and Spencer annual report is another means of passing or sharing information to both their stakeholders and the public. Their annual report always comes out ending of the year which includes the organisation budget, plans, development, profit &loss.tc. The annual reports are always used to send information to their stakeholders updating them about the organisation activities.

Conferences: The organisation conference is been held to share information with their stakeholders, their staffs, the public, their managements. Marks and Spencer conference provide them with enough ideas about the areas the organisation needs to improve on. It also helps the management pass information to their stakeholders about their development process and their yearly budgets. This will enable the organisation to be in a good relationship with their stakeholders and staffs. [END OF P18]

Task 6c

6.3 System for monitoring the strategy plans for Marks and Spencer [P19]

Systems for monitoring

Ways of monitoring

Human resources management system ? Absentees

? Labour turnover

? Complains

? Training

? Motivation

? Recruitment and selections.

Information technology system ? Tracking systems

? Software s to monitors consumer performances

? Websites

? Tele conferences

? Video conferences

? Phone callings

? CCTV systems.

Marketing system ? Marketing researched system

? Marketing intelligent analytical support system

? Marketing information system

? Environment monitoring

Quality control system ? Just in time system

? First in first out system

? Last in first out system

? International standard organisation

Financial system ? Financial planning records

? Accounting records

? Internal control system

? Program income

? Salaries and wages

? Recording budgets

? Banks statements

? Payroll records.

These above strategy are use to monitors M&S systems. These have helped the company to understand and know how to control their organisation.

[END OF P19]