Marks and Spencer Internal and External Factors

label and Spencer Internal and international FactorsAnalysts did not expect there to be a double-dip recession first, save changes in consumer expense trends raised concerns for keeping a keen shop center on consumer confidence by carrying out in-depth customer surveys every month. This was to come and stay realistic. Leaders of large firms are very cautious regarding UK economical surroundings.UK is considered to come through the deepest ravages of the economic turmoil recently and in such(prenominal) a situation heretofore MS managed to post lettuce of 632.5m for the detain pecuniary year. With the worst burdens of the recession behind , the strong foundations in place, and its core honours helped MS set for growth under expectant circumstances. At 632.5m, MSs adjusted pre-tax profits for the 12 months to 27 March were 4.6% laster(prenominal) than a year ago but well be first-class honours degree the 1bn profits achieved in 2008. These stats along with the new budget announcement, match on consumer spending remains a cautious issue and leave take on impact on panorama for the year up.Business Environment Analysis brayThe external environment of Marks Spencer is comprised of all the elements that determine what the it require to neck in its respective application. next is extravagantlylighted some factors of MAs external environment and how they effect Marks Spencer in executing its strategies(P)OLITICALEuropean Integration and Free dowery Agreements have opened up commercializes for British other Companies to invest in Europe. gum olibanum, causing MA to fight rough to maintain its merchandise share with aggressive strategies. Generally any trade is allowed in UK provided that it does not correspond public policy, public order, or any existing law in the land. But for Marks and Spencer, the most troublesome political elements that they have to contend to deals with the issue of labour laws and industrial relationship.In t he long history of MA, its developing efforts have been controlled by many infringements in labour laws in local anesthetic movements and besides in international initiatives.(E)CONOMICUK Retail sector is sort of recession prawn and also very sensitive to changes in care rates. With the so fart of September 11, the world economies have suffered heavily, Once the customers and economy was on boom track after September 11 post effects, the financial crisis of 2009-09 has again set the economies struggle for survival. UK economy after fighting hard has presently regained its system and consumers are again optimistic and the retail industry is once again booming. The United Kingdom being a hub of commerce in Europe, has consumers not particular to only locals but flocks of tourists also, thus creating ofttimes variations in base trends and retail business.(S)OCIALChanges in consumer taste and lifestyle fabricate both opportunities and threats for the industry. UK consumer have a true tendency particularly towards brand. tonus of the produce, but these factors shtup be easily overcome by fairly competitory pricing outline from a competing brand. Moreover, consumers preference towards trendy styles sort of than classics are also apparent in UK consumer merchandise. This is specially in eluding of Marks and Spencer, as it has struggled hard to gain a greater market share of its customers. This makes evident that UK consumer places high value on their money.(T)ECHNICALChanges in retail methods such as Internet used as online shopping blood line is a common practice in retailing, widening the scope of ecommerce. Moreover, Paperless operation and use of IT systems has provided flexibility in the executing operations of the business. Online marketing activities over the net is also becoming one of the war-ridden advantages held by the stellar(a) retail companies in UK.(E)NVIRONMENTALThe renewable and environmentally friendly sources of resources used in production are opted by most of the companies across globe now which has posed greater struggle for companies to maintain its market share. For Marks Spencer, protective(predicate) use of fabric and raw materials is a greater concern now.(L)EGAL case legislation for health and safety both in terms of consumer rights and also in terms of production of own natural renewable resources for reservation clothes is closely monitoring practices of companies so as to evaluate them on complying with legal restrictions .Analysis of the External Environment of Marks and SpencerThe retail environment in UK appears to be extremely attractive. Companies, although have government support still there exists in the market some level of difficulty in penetrating the retail market, especially for new entrants, imputable to the strong acquire of monoliths This is also true companies like Marks and Spencer, having strong historical mise en scene that their environment is essentially welcomin g and neglecting the fact of cutthroat nature of the competitor there are chances of immense demise for companies.PORTERS 5 FORCESPorter explains that tailfin forces exist in a market, which determine the intensity of challenger and gainfulness of MS .The first is the threat posed by new entrants, the high capital expenditure and customers changing expectations put significant barriers to entry, making market also sensitive to reputation. But, with emergence of low cost manufactures a significant threat is posed for MS market. There is an opportunity in the low price/ low economy (fast) sector and BHS and Top Shop or ASDA may also consider introducing low cost home products. The uphold is the threats from substitutes, as there are many retailers in both wear and food sector, MS has serious concerns regarding this. The third force is the threats from the bargaining major power of buyers, this is strong for both MS and the entire food retailing industry with a large number of alternative suppliers, hence, the aggressive pricing strategy which causes strong competitive rivalry in the industry and is getting step up because of little or no unlikeiation in the basic product offered. Last is the threats from the suppliers bargaining power which is considerably low for food industry, delinquent to a range of alternative sources of supply easy for products. thrumSWOT Analysis will help us in understanding Marks Spencers current situation in terms of strengths and where improvements are required inwardly the business and what outside environmental threats it faces along with what new opportunities are available in the short and medium term.(S)TRENGTHSDiverse ranges of Products Food, Clothing, Financial products, furniture, wine and legal residenceLargest retailer in the United Kingdom by sales.Strong hard currency Flow PositionIncrease turnover and trading profits jumper lead Premium Quality Food Retailer trade name Awareness(O)PPORTUNITIES radical Pro ductsInnovation AlliancesCustomers demand change to more than value for money products aim overseas supply kitchen range(W)EAKNESSESPerception of High PricesCustomer disinterestEnvironmental issues PollutionsSubstitute products or technologies(T)HREATSNew existing competition excitableness in Price of raw productsNew legislationsEconomic recessiondepression cost retailers Extremely high competitionAnalysis of the Macro environment MicroenvironmentMS is rated a successful multinational corporation. It has created its large number of loyal customer base by providing them with its high quality, good service, comfortable shopping environment and convenient access to outlets and products. But, due to the immense competition in market and also MSs own wide product ranged offered it has to revise its marketing segmentation approach, especially in reference to clothing market. Consumers have changing fashionable design and coloring requirements and MS as is facing different target mark ets need to change its designs, cuts and color schemes to meet their demands. These need to specialised and separate for women and young consumers who are its main target.MS also needs to enhance job management. Combing its information technology system with gestate management ca help MS find problems immediately and thrash them efficiently to supply products timely.MS also needs to consider the world(a) economic environment, where the economic recession has caused deciling sales for MS, it should focus more towards mid-age and mid-class as its target group as now their incomes can afford the high price of MS.Trend Impact AnalysisProposed Strategic Plan for MSAfter doing analysis of the environment of the MS, the proposed strategic plan will be considering both the internal as well as external environment. ab initio its value chain should be focused onValue ambitThe value chain of the organisation is coined primarily by Porter as a tool to recognise the inherent capabilities o f the organisation to realise its competitive advantage. The following will describe the unproblematic activities and support activities of the company.Primary ActivitiesThe primary activities take in hand several specific functions of the company incoming logistics, operations, outbound logistics, sales and marketing, and service. Marks and Spencer receives its inventories from its suppliers, initially the strategy was to stay limited to English suppliers but eventually this trends is now shifting and now suppliers complicate international suppliers also. Marks and Spencer is involved in the direct selling of apparel, foodstuff, and even home furnishings. The sales and marketing of the company should be the most prioritised elements for the organisation, due to the intense competition present in the industry, vying for consumer favour and to add value to the brand , it takes a step above the rest of these primary activities. concomitant ActivitiesFor these support activities, th e company needs to have hold of its f gracious resource and technology, where with help of proper training of common employee, the company can ccreate knowledge of its products and their awareness during the processes of selling to customers. Use of technology in same manner can significantly infused in the operations of Marks and Spencer. This includes providing online legal proceeding and loyalty cards on which they should be doing continuous improvements and innovation.Strategic Options purchasableTo create sound strategic options for the MS, they must consider the benefits and impacts those can have on company financial position and customer base also. Following are discussed some options which following the current recession and UK competitive market structure can be of good benefit for the companyBrand repositioning this technique if used to create fresh feeling in the minds of customers for the brand after frequent intervals. Moreover brand repositioning requires a lot of work on new targets, segments and options, the changing consumer trends and demands can be well handled by MS using such strategiesThe rapid competition demand fast and logical decisions which are flexible and designed in such a ways that immediate implementation is possible as customers dont have time now and immediately switch to other brands. Thus the structure of decision making should be redesigned to make it more unified and flexible.Of the many strategic options available for Marks Spencer it appears that Marks and Spencer could focus on to refurbishing its operations. For instance, the company should look into a partnership with the more current and competitive players in the retail industry. This can help broaden the overall outlook of Marks and Spencer regarding their standing in the market.Marks Spencer needs to move ahead with major technology-driven change projects, despite cautiousness over the economy. Improvement in systems can also take place to improve supply c hain processes which includes enhancing stock management systems to provide more accurate real-time stock level information.Getting Cost efficiencies by introducing some new point-of-sale system and better customer service to all storesBuilding a strong multichannel capability can also be useful which will result in more website development and introduction attractive and more efficient facilities and stock availability information for customers