Impact and Influence of Macro Environment on Marks and Spencer

Running head: Business strategy
Business Strategy

Business Strategy
Marks and Spencer
P1.Impact and Influence of the macro environment
PESTLE ANALYSIS
Political Analysis
It has been analyzed that the sourcing cost has been decreased just because of the EC's
free trade agreement. In the international market due to high-cost structure, the company has to
face the issue to enhance the market share. The initiatives of Marks and Spencer have been
affected by the energy efficiency scheme of the UK government. It has been analyzed that the
company has to face the issue related to the labor laws. Marks and Spencer have also suffered a
reduction in the sourcing costs (Souza-Monteiro and Hooker, 2017).
There are various regulations and policies which are given by the government like
recycled packaging and also animal welfare protection. Also, it has been analyzed that Brexit
have the major implication and also there is a major change in the political landscape of UK and
it has affected the operations of the company in UK and Europe. It has been evaluated that
depreciation of sterling has reduced the revenue and impacted the spending process of customers
(Baker and Saren, 2016).
The retail sector has faced the huge pressure of taxation laws. For example: In India, it
has been evaluated that demonetization and implementation of GST have to be followed so that
operations can be conducted easily. It has been analyzed in BBC News that the company is
considered as one of the retailers to reduce the fair trade route on both clothing and food sector
(Scott and Walker, 2017).
Economic factor
It has been seen that the retail sector is sensitive in context to the change or variation in
the tax and interest rates. When economic slump has analyzed it has been seen that the retail
industry is booming in the present scenario also. There are many competitors like Asda who
imports their goods from other countries so that the cost can be minimized. It has been analyzed
that this is the major disadvantage for the company as they purchase the goods from within the
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Business Strategy
UK (Fernie, Fernie, and Moore, 2015). Marks and Spencer is also affected by the competitors
who are offering products at fewer prices. The company also emphasizes on maintaining the
quality which can lead to loss but it helps to induce customers to purchase the products
(Wuebker, Baumgarten and Koderisch, 2017).
In the present scenario, the economic outlook is uncertain and this has given impact on
the retail sales. It has been analyzed that nowadays people don't have an extra amount to spend
on the expensive items like clothing and food items. The company has closed many stores in the
recent scenario and also the job is reduced by 2 % out of the 70,000 staff (Singh, 2018). It has
been evaluated that the company also focused on wine and champagne so that competition level
can be maintained in the market. The company also brought change in the method of marketing
the products and also the impact is seen in the recession.
Socio-cultural factors
In the social context, it has been evaluated that there are two factors that have given
impact on the retail sector. One is related to the changing values of the people and also with the
generation shift. The values of the people keep on changing which give impact to the supplying
power of the company. There are many initiatives which support the communities and through
this, the internal cost can be reduced. It has been analyzed that the company has taken into
consideration the social agenda so that growth can be achieved in the market. Marks and Spencer
focused on maintaining relations with the customers and suppliers so that demand can be
maintained. In 2015, it has been seen that food surpluses were considered by conducting the
operations with the redistribution partner through a program named "community shop". Also in
2016, the company considered "Spark Something Good" which involved 1000 employees in the
work related to community and charity (Marks and Spencer Plc., 2018). These are the programs
which have been considered by the company so that it can be simple to maintain a competitive
advantage in the market.
Legal factor
In context of the legal factor, it has been seen that there are many factors related to safety
regulations, consumer rights and environmental rights which have given impact on the company.
The company focused on an initiative which is named as "Behind the code", which offers
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Business Strategy
customers an experience of omnichannel that help to order products online. This is considered as
one of the examples which Marks and Spencer abide. Marks and Spencer considered new
reporting regulations in 2014 which emphasized the framework related to remuneration and it
offers greater transparency to stakeholders (Cavallo, 2017). The company focuses on considering
proper VAT system so that it can be simple for the customers to purchase the products.
Technological factor
Marks and Spencer is in a good position to focus on the benefits related to media. It has
been seen that the company emphasize more on marketing the products through social media
platform. If the focus is given on the fashion business it has been evaluated that new trends are
easily communicated to the designers and it has enhanced the overall speed of transportation.
With the help of internet, it has been analyzed that the shopping experience of the customers has
been enhanced and this has given growth to the company. It has also enhanced overall profits of
the company with the digital technology.
Social media is one of the effective methods that are considered by the company so that
the promotion of the products can be done effectively in the market. It has been seen that through
social media it can be simple for the customers to gain information about the products and
services of the company. Through this, the discounts which are offered by the company can be
availed by the customers easily. Social media like Facebook is considered by the company so
that it can be easy for the customers to purchase the products (Grant, 2016).
Environmental factor
Marks and Spencer focused on considering proper rules and regulations so that customer
pressure related to business practices can be maintained. To maintain the condition of the
environment, the company has considered focusing on minimizing the waste and it also helps the
communities of the stakeholders. In 2015, the products of the company were sourced from Gold
and Silver sustainability producer standards and 10.6 million garments were donated to Oxfam
(Manfredo et al., 2016). It has been evaluated that the company focused on considering plan A in
which the first UK Eco factory was considered. In 2016, Marks and Spencer also become
transparent in its supply chain by publishing a map of the sources of the company and its entire
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