Failure of Mothercare business within UK

Dissertation

Table of Contents
TITLE: - Failure of Mothercare business within UK......................................................................3
CHAPTER 1 : INTRODUCTION...................................................................................................3
Rationale of study...................................................................................................................3
Aim: -......................................................................................................................................4
Objective.................................................................................................................................4
Research Questions................................................................................................................4
Structure of the Report...........................................................................................................4
CHAPTER 2 : LITERATURE REVIEW........................................................................................6
The factor that affect Mothercare business in UK..................................................................6
Several consequences that affected UK market due to failure of Mothercare.......................7
Ways through which Mothercare can recover from its current position in UK market.........8
CHAPTER 3 : RESEARCH METHODOLOGY............................................................................9
CHAPTER 4 : DATA ANALYSIS AND INTERPRETATION...................................................15
CHAPTER 5: CONCLUSION & RECOMMENDATION...........................................................24
Conclusion............................................................................................................................24
Recommendations................................................................................................................25
REFERENCES..............................................................................................................................27

TITLE: - Failure of Mothercare business within UK
CHAPTER 1 : INTRODUCTION
Mothercare plc is a British retailer that offer its product or services that are related with
the child care that comes under the age group up to 8 years it mainly caters the customers that are
mother-to-be, new babies and children up to the age of eight. It opened up its first store in 1961
within Kingston, Surrey and at that time it mainly focuses over nursery furniture, pushchairs and
maternity clothing. But after that it expanded business by including range of clothing for children
as well. Now, it offers’ wide range of products such as maternity as well as children’s clothing,
bathing, bedding, feeding, furniture, travel and toy equipment’s by managing range of retail
stores in street of United Kingdom and several other countries of Europe, Africa, Middle East
and far East. In year 1972, Mothercare become the first brand that get converted into public
company and then in year 1982 it get merged with Habitat chain of retailers and after that in year
1984 it get enter to the international business by developing its franchise retail store in several
different countries. Now, it is currently operating its business in more than 40 countries
throughout the world with the help of franchise agreement.
But recently unsuccessful story of Mothercare revealed where it has been found that
company get fail in performing well within the UK market. It leads to shut down of many stores
and now it reach up to 79 stores only within UK and its online business is also get affected
hugely with the sever loss of approx. 2800 jobs after getting call in administrator from
PricewaterhouseCoopers. The company is operating in UK market from year 1961 and also get
listed within the London Stock Exchange but from year 1972 it started get an issue in competing
with the cheap super market clothing ranges and after that great rise within the online shopping
also affected its profitability. This issues gradually increases with the advancement of technology
and development of more and more competitors within marketplace. As a result of which the
Mothercare found it very much difficult to manage effectively in Market of UK and for cutting
off cost it started closing it stores from the Streets of country.
Rationale of study
The main aim behind performing current study is to determine the present condition of
Mothercare of within UK as well as uncovering various facts that are the main cause behind the
failure of company within the UK market (Barrow, Barrow and Brown, 2015). In addition to this

it will also support in determining the number of consequences that it brings along with its
failure to the UK market. This in turn further help the other organising in getting an idea
regarding the factors that may affect business which in turn support them in formulating effective
strategies. Other than this, by deeply investigation about the factors that are causing failure to the
business it become easier to determine the actions that can be taken into consideration for
improving its condition.
Aim: -
“To investigate the major reason behind the failure of Mothercare in UK market.”
Objective
 To find out the factor that affect the Mothercare business in UK
 To identify several consequences that affected UK market due to failure of Mothercare.
 To analyse ways through which Mothercare can recover from its current position in UK
market.
Research Questions
 What are several factors that affected the Mothercare business within UK?
 What are several consequences that affect the UK market Due to the failure of
Mothercare?
 What are several ways through which Mothercare can recover from its current position in
UK market?
Structure of the Report
It is considered to be a most significant part of a dissertation which represent about set of
chapters that are involved within it and information that each chapter represents. This provide
reader an overview about the chapters which make it easier to understand the information
effectively. The structure of report is mentioned below:
Introduction: - This is first and foremost section of the dissertation which represent
basic information about the topic over which study is to be conducted along with its background
information. Additionally, it also presents information regarding the rationale behind the study as
well as main aim or objective of the study over which the whole study depends.
Literature review: - This chapters is considered to be a base for a research as it perform
a thorough study over the main topic of the research by evaluating the existing information

already available through several secondary sources. This support in determining the nature of
study so that researcher can proceed the research further by considering the existing knowledge
as a base. This section support in providing direction to the study by providing a specific area
that help in deciding the actions to be taken for performing study.
Research methodology: - This is third and most important chapter for a dissertation as it
provides detail about the set of methods, tools, techniques etc. used for performing current study
in more effective manner. This support the reader in getting an idea regarding the procedure used
for performing and presenting the study so that it can understood more effectively.
Data analysis and interpretation: - Under this section of an investigation the gathered
information get evaluated in order to extract out the main findings over which a particular
phenomenon can be proved right or wrong. This section is crucial as it support the investigator in
extracting out the conclusion of all the gathered information.
Conclusion & Recommendation: - This is the last chapter of a report which present the
actual conclusion that get extracted from the findings while comparing it with the main aim of
the study. This will support in determining that whether the aim of study proves to be successful
or not. Additional to this, it also includes recommendation regarding solution to the problem
found in the study.

CHAPTER 2 : LITERATURE REVIEW
Literature review is defined as the process of evaluating the information which is already
beings studied or published which is related with current area of study. This support investigator
in determining the nature of study as well as creating a base of understanding over which further
study can be performed. Hence, literature review support in directing the investigator regarding
the area in which an investigation must be performed.
The factor that affect Mothercare business in UK
Don-Alvin Adegeest, 2019, a well-known retailer that has been trading from around 58
years founds number of difficulties in operating its business for long in UK street. It went
through a huge downturn in term of economic condition as well as its image within the
marketplace. There are number of factors that are behind the failure of business such as
 No differentiation: - The Mothercare is facing a huge competition from increasing
fashion brand, big supermarket as well as online retailers. Though its international market
remained highly unaffected, the core product of Mothercare failed to differentiate itself
from that of other brands such as H&M, ZARA, LIDL, Sainsbury, Amazon, Zalando etc.
 Not digital first company: - In march 2017 Mothercare maintained a turnover of 171.9
million pounds but as the local stores within UK get closed ion order to reduce the debt
or losses, the company fails to provide services through omni channel which customers
demand for (Wardani, Wimanjaya and Cahyaningsih, 2019). This is also one among the
main reason where Mothercare fails to fulfil the demand of its customers which in turn
brings a huge influence over the profitability as well as financial condition of company.
On the other side, Dearbail Jordan, 2019 stated that the one among the biggest retailer is
struggling to operates its business in UK market and its struggles are not at the shore as a result
of which it is finding difficult to find buyer for the operations. The number of factors that are
behind the failure of business are mentioned below,
 Increased competition: - Like other struggling retailers, Mothercare is also facing
several issues and being squeezed by the big increasing fashion brands, supermarkets or
internet. The company has continuously experiencing success at overseas, but UK market
is quite different from others as majority of people prefer to go for online purchasing for

more convenience. Other than this several of its competitors are Tesco, Sainsbury etc. are
offering range of clothing options with more convince.
 Online problems: - With its enter to online platform company experience a better
growth on it and in year its sales grew to hit around £171.9m. But there are number of
issues found in maintenances of E-commerce channel of Mothercare where it is being
complaint by its customer that online structure is too difficult to understand (Wessels and
Kokorin, 2019). As due to geo-blocking a visit to its website take customer to Irish
webpage instead of UK sit. In addition to this there is not any option of sharing link
which make it difficult to take suggestion from other people.
 Downward spiral: - The Mothercare maintains around 353 stores within UK but as it is
struggling with business expenses, so in order to reduce the losses as well as its debts it
was decided to cut down stores to be in level. But this decision went into wrong direction
as regular closure of business is actually damaging the business growth as well as
survival in UK market.
Several consequences that affected UK market due to failure of Mothercare
As per the information presented by Deborah Williams, 2019, Mothercare face several
issues that affected its performance in the marketplace of UK which brings up a biggest turn
within its history. This brings up several negative consequences, as one among the biggest
retailer get failed in the market. As a result of which the retailer which was operating around 134
stores over the streets of UK now get compressed with only 79 stores left at present. This in turn
have a huge influence over the economy of the country as it constitutes one of the major part of
national economy in term of GDP or Tax. Despite of this, it also affected the employment rate of
the country after closure of its stores. This is so because, with the cease of trading in UK by
closing up its chain of stores their remains a total loss of 2800 jobs within UK. This in turn badly
affected the financial condition of several people as country is already facing a sever issues of
economic down turn due to Brexit which has increases the inflation rate. After the closer of
several stores of Mothercare this financial issues are also get increased for some people who are
connected with the brand and working for it from so long (Resnick and Robertson, 2014). This is
so because the closure of its stores take up the job of several people which in turn highly
influence their livelihood as they find it difficult to manage their basic needs without income.
Other than this, they also found it difficult to get job in UK as country is already suffering from

financial crises as many of the organisations get shut due to Brexit. So the shutting down of
Mothercare stores brings up several negative influence over UK as well as people living their.
Ways through which Mothercare can recover from its current position in UK market
According to the view point of Robson and et. al., 2015, the market failure of Mothercare is
getting more and more challenging for it to get recover back as its is getting difficulty in
improving the current position in market and also not become able to manage the current stores.
But in order to get back its position it become very crucial for the Mothercare to put more
emphasis over its administration practices so that the errors that are present within the operations
can be improve or rectified so that work can be further improved. Despite of this, the Mothercare
must also focuses toward setting up its online presence in more effective manner so that it can
provide a tough competition to the brands that are already dealing in the market and getting
benefited with the failure of business (Imtiaz, 2015). By setting up the online presence the cost of
the company can be reduced which can be further implement over improving the current
practices of the business and can be used for promoting the brand without spending much over
the promotional events. Hence by saving the cost from this side the Mothercare take advantage
of its for improving its current market performance. Other then this there are several other
actions that Mothercare can take in order to improve its position by attracting customers toward
it, such as
 It must focus toward improving its in store convenience by well arranging and categories
the products as per different attributes. This is so because the customers are switching to
supermarket due to this feature of convenience. Hence it supports in providing customers
a factor visit store and experience a most convenient and happy shopping.
 The e-commerce channel provides 24-hour facilities which attract the customers most,
hence by adding this option to its physical store, Mothercare would be able to regain its
customer base and as a result of which its issues regarding access to cash can also be
resolved with increasing profit.
 Another option that it can add to its store are self-checkout services this in turn support in
providing customer a self-service option which in turn support in reducing the queue
time. Additionally, it also supports in reducing the further recruitment cost as well as
delays in work.