Analysis Of Marks And Spencer External Environment Marketing Essay

Marks and Spencer is one of the biggest trader having inheritance of more than one hundred and twenty years. It has more than 895 stores in more than 40 regions all over the world. Its head office is in U.K, in the city of Westminster. Marks and Spencer mainly deals in clothing, homeware food, technology, beauty, financial services, energy and hospitality.

Michael Marks from Slonim, Russia and Thomas Spencer a cashier from Yorkshire pioneers of this U.K’s biggest retailers. At Leeds (Kirkgate market) in 1884, Michael Marks started his own business by opening a penny bazar stall. Then to develop his business he opened a shop at Manchester with the partnership of Thomas Spencer.

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After the death of both the pioneers of the company Michael marks Simon became the chairman of company while William chapman took the helm until 1960. During the era of the Marks Simon the company touch the highest point. The business was floated as a public limited company after 10 years.

In 1998 it was the first company of U.K who earned the profit of one billion pound after tax deduction. Marks & Spencer prohibited smoking first time in his stores that became later on a legal offence to smoke at public places.

Q No 1: Analysis of the organisation’s external environment?

External Environment:

External environment means the factors that directly or indirectly affect the internal function and perhaps business strategy and objectives as well. Most common factors of external environment are political, social, economic and technical. These factors are totally out of control of the organisation, but company could be able to take some steps to overcome these challenges. Basically external environment defines the competitive situation of organisation and potentially have both positive and negative impact on businesses analysis targets four major categories of external factors that affects company’s capability to grow. Based on operation region, external environment is divided in to three interactive segments which is remote, industrial and operational environment. External factors produce different influences on company’s productivity. On the other hand some influences are inter-linked with each other. For example information technology completely changed the way of work, customer behaviour and life style as well. Based on PEST analysis four major factors are going to be discussed in detail.

Political Environment:

Political stability in a country attracts the investors to do investment and that is a very key factor to grow business. Second thing is about government trade policy, either it is flexible or hard. Every organisation operates under the government policy about trade and within the legal frame work. The legal frame work covered many areas like tax rates, employee’s benefits, wage legislation, trade regulation and tariff. Supplier customer and competitor are also affecting by political environment.

Economical Environment:

Economic condition also affect organisation external enviorment.in this regard some factors that in influence business are tax rates,inflation,money supply, government need, economic growth rate and tendency to spend at international and national land.

Social Environment:

In social context, normal Britain customer leans towards a specific product. In every transaction product quality matters a lot, but it could easily be beaten by putting some good pricing of the same brand. Some fresh analysis about Britain’s customer is that they prefer some fashionable style over classic trends. This can be seen in M&S case that they are still struggling to get a bigger market share. Now it indicates that Britain buyers are very keen about their wealth.

Technological Environment:

Now days a large number of population could be able to use internet. It means that by using e-commerce many organisations can be able to widen their horizons and do many operations. This can be seen in foremost companies like Sainsbury, Tesco and ASDA as well. These days most of the trading and purchasing is done through net, and also it become a competitive advantage of an organisation.

Analysis of External Environment of M&S:

The UK retail market is very eye-catching, just minimum restriction of entry the company has full sport from government. One problem is coming in this respects is, to new contestant, because there is already very powerful pillar in the market who are willing to throw the new one out of the race, as quickly as possible. The company’s like M&S who have rich historic values, the case is the same. As there environment is very warm welcoming. They reject the idea of leg pulling in the market race, because these things drive the company towards the immediate death.

References:

http://ivythesis.typepad.com/term_paper_topics/2010/07/case-analysis-of-marks-and-spencer.html#_Toc203466502

Q No 2: Analysis of the organisation’s internal environment and identification?

Internal analysis, which is also called SWOT analysis, is a very important part of business development. Swot analysis is a simple structure for generating strategic alternative from a situation analysis. Swot is an abbreviation of strength, weaknesses, opportunities and threats. In late 1960, Edmund p defined Swot structure. Learned, C. Roland, Christiansen, Kenneth Andrews and William d Guth in business policy, Text and cases (Homewood, IL; Irwin 1969).In 1980s general electric growth council use this form of analysis. Basically it throw light on company’s strength & weaknesses. The strength mention different aspects that bring result in market value and weaknesses draw the attention about those areas which need improvement. Swat analysis is fruitful where you have to tackle a complex situation in a limited time frame.

Origination of an effective strategy has based on a clear definition of organization mission, an accurate assessment of the internal analysis of the organization, organization requires success it needs ingredients, they are as listed:

Strategy must be carefully verbalized, applied, manageable and accomplished.

Internal analysis of the organization is too hard and thought-provoking one to strategist.

During 2005-06 M&S have seventy thousand workers all around the world. Company is always looking that employees structure should be varied, just to redirect the nature of people that utilise them, same as different. M&S also write pledges that they have equalizing prospects according to age, debility, race, views about politics, cast, working hours, thought about religion etc.

M&S also arrange flexible working schedule for fatherhood, adoption and IVF treatment, also child and career break to boost their employee’s uniformity. M&S also runs Business Involvement Group (BIG), which is a work demonstration forum in his every single store and offices area that inspire their work force to share information and develop discussion about the company’s business. If we talk about salary and welfare, the company has some incentive packages that include fundamental fixed pay. As for training, in 2005-06 more than 102,000 days were fixed for training purpose in which M&S try to develop inner aptitude and skill of his workers. Marks and Spencer also entitles that they have great concern about health and safety of their employees, and for this purpose they are giving a wide range of work related health services.

The company’s code of ethics is also developing to give guideline to their member concerning their responsibilities towards customer, workers, stockholders, dealers, societies, government and environment.

References:

http://ivythesis.typepad.com/term_paper_topics/2009/09/marks-spencer.html

http://www.omniglot.com/info-articles/burlineton/shaklee_business_opportunity.html

Q No 3: identification of the major issues challenging of facing Marks & Spencer?

M&S is one of the UK’s biggest traders, giving different services to his customers in the field of food, clothing, and house hold products. They tried at their best level to give good customer service and at an affordable price, but it is not always very easily. M&S is losing his trend towards the youngster’s and their other opponents in the market are taking advantage of this weak point. This is the biggest challenge that M&S is facing now a days. To overcome this weak point M&S is also taking steps to provide cheaper products to his customer, but for this they have to import their raw material, which also lessen the M&S image of “British Goods Seller”. Cards and cash method was used for payment since 2001.

Customer is becoming more conscious about natural and environmental issues, so for this M&S launches plan A , which consist 180 commitments to overcome the challenge So many problems are related with weather changing issues, so to tackle these changes M&S is doing much effort. They are reducing their waste material that going to land fill.

Marks and Spencer had seen very tough time during the period of recession, but now it looks that everything is coming back on its actual position. The company’s thirteen weeks before the starting of OCT (2010) is very hope full. Home ware make an astonishing growth in sales up to 7% and food stuff which was last year 3.6%, this year it increases up to 3.7%.Clothing section is also growing, which is the most fast running sales item of M&S. It was also helped by bigger BRA and most astonishing the introduction of non-iron linen cloth. During the autumn the women shoes sales touches a record, which M&S claims that it was because of their strong advertisement.