Impact of External Environmental Factors on Marks and Spencer

This report analyzes the impact of external environmental factors on Marks and Spencer, a British multinational retailer. It discusses the political, economic, social, technological, environmental, and legal factors affecting the company's business practices.

Global Business
Environment

CONTENTS
Introduction................................................................................3
Main Body.................................................................................3
Conclusion.................................................................................5
References..................................................................................6

INTRODUCTION
Global business environment is defined in the form of different factors that may have a
direct impact over business decision making and resource as well as capabilities (Bedianashvili,
2016). This report is based on Marks and Spencer which is a British multinational retailer
founded in the year of 1884 by Michael Marks and Thomas Spencer. This report determines
impact of external environmental factors over the business practices.
MAIN BODY
PESTEL analysis is a framework that helps in analysing direct and indirect influence of
macro environmental factors over the business, it operational activities and decision making. In
context of Marks and Spencer, the influence of external environmental factors of UK is
determined below:
Political factor: This factor determines government intervenes in an economy in order to make
sustainable changes. This includes foreign trade policy, tax policies, law and regulations and so
on.
 Opportunity: Government of UK supports free trade policy between a multitude of
countries thus, it would be beneficial M&S because it operates in different countries.
 Threat: Brexit is an only reason the create political issues for Marks and Spencer while
operating effectively in the UK market.
Economical factor: This factor determines the significant impact of economical
practices have upon business and its profitability (Barac and et al., 2016). It includes interest
rates, inflation, disposable income and so on.
 Opportunity: Marks and Spencer is a big chain in which numerous of employee
provides their contribution. Thus, M&S provide its contribution in job creation in the
economy.
 Threat: Discount competitor may raise issues for M&S in business suitability in existing
economy.

Social factor: This factor determines beliefs and attitude of target audience towards the firm. It
includes age distribution, career attitude, population growth and so on. Social factor also
determines the impact of change over the business decision making and growth.
 Opportunity: M&S implement ideas by considering new trends thus they can sustain in
the market with a leading approach.
 Threat: Frequent changes in customer’s requirement may raise issues for firm.
Technological factor: This factor determines the requirement of implementing changes in an
organisation as well as its potential impact over the market and business practices.
 Opportunity: One major advantage for M&S is its online marketing practices by which
they connect effectively with worldwide customers.
 Threat: Advancement of technology requires frequent changes which may raise issues
for firm.
Environmental factor: Nowadays, environmental factor has become a crucial aspect which has
a direct impact over business production and sustainable deliveries (Tallman, Luo and Buckley,
2018). These factors are basically supported by government of a country in order to effectively
manage its environment.
 Opportunity: M&S supports eco-friendly approaches thus it would be beneficial for the
firm.
 Threat: Implementation of eco-friendly approach requires additional charges which may
raise issues.
Legal factor: This factor includes all the legal practices which are required to implemented by
an organisation in order to work ethically and legally in a country. It includes consumer rights,
employment right, policies and procedures, advertising standards and so on.
 Opportunity: Effective implementation of legal practices may help to manage maximum
opportunities.
 Threat: Filing excessive tam may raise issues in earning desired profits for firm.

CONCLUSION
Form the above report it has been summarised that external environmental factors have a
direct impact over the business practices. Thus, it is required for firm to effectively manage all
the activities strategically in order to reduce negative impact of such.

REFERENCES
Books & Journals
Bedianashvili, G., 2016. The Global Business Environment, European Integration and the
Cultural Potential of Social-economic Development of Georgia. Globalization &
Business.
Barac, K.and et al., 2016. The capability and competency requirements of auditors in today's
complex global business environment.
Tallman, S., Luo, Y. and Buckley, P.J., 2018. Business models in global competition. Global
Strategy Journal. 8(4). pp.517-535.