Identity and Retail Spaces Analysis

This assignment delves into the concept of 'Identity in Retail Spaces,' examining how various factors influence consumer behavior and shape retail experiences. It analyzes the behavioral consequences of service quality within the Chinese retail pharmacy industry, explores spatial inequality and opportunities for change in urban food deserts, and investigates customer bargaining dynamics in retail stores. The analysis also considers micro-environmental factors impacting retail identity, including technological advancements, social media trends, and online promotion strategies.

RETAIL THEORY AND
PRACTICE

Table of Contents
INTRODUCTION...........................................................................................................................1
COMPANY INTRODUCTION......................................................................................................1
KEY RELEVANT CHANGES WITHIN THE UK FASHION RETAIL.......................................1
RELEVANT CHANGES WITHIN THE MICRO ENVIRONMENT............................................3
STRATEGIES AND TACTICS THAT COULD BE USED BY THE RETAILERS....................5
CONCLUSION................................................................................................................................6
REFERENCES................................................................................................................................7
Appendix 1.......................................................................................................................................8

INTRODUCTION
The trend and culture is changing very fast which is increasing the business of fashion
retail businesses within UK. Fashion and retail industries in United Kingdom is growing day by
day that people these days are more demanding towards fashion. (Kita and Grossmanová, 2014).
The retail industry is very important for UK economy, in 2016 this sector generated more than
£360 billion worth sales in retail market. It is a biggest private sector employer with more than
290, 315 retail outlets all around the United Kingdom. The British fashion during 20th century is
fascinating because the trends and styles are drastically changing every decade. The flapper girls
of the 1920’s were wearing daring outfits for reflecting the new freedoms womer were achieving
such as voting rights. In 1950’s people started wearing more stylish clothes as the company was
becoming prosperous. According to present situation UK is one of the lading country in terms of
fashion and trends. Clothing aparrel and other accessories(shoes, handbags, undergarments etc.)
manufacturers practice the fashion merchandising variously than retailers while making
decisions they must keep customers and retailers in mind effectively (Kotusev, Singh and Storey,
2016).Manufacturers meets designers to make creative and innovative products for the customers
which they purchase most. The Marks and Spencer is one of the biggest fashion industry in UK
with the market value of 8.15 billion pounds. Retailers and fashion firms are increasing their
profitability these days (Desjardins, 2016).
COMPANY INTRODUCTION
Marks and Spencer is the second largest fashion firm in UK with current market value of
7 billion pounds and annual sales is about 10.03 billion pounds (Drucker, 2017). The firm is in a
long term relationship with British manufacturers. The financial performance of the business for
the last three years 2015 to 2017 is 600.03, 488.08 and 613.08 millions in terms of profitability.
The firm is also known as M&S and it is a British multinational retail sector firm headquartered
in Westminster, London. The M&S sells cloths, luxury food products and home products to the
customers (Kita and Grossmanová, 2014). The firm was founded by Michael Marks and Thomas
Spencer in 1884. Currently the company has 979 stores across United Kingdom and 615 from
them only sell food products. This will signify that the firm is in a profit situation and trying to
expand their business activities.
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KEY RELEVANT CHANGES WITHIN THE UK FASHION RETAIL
It can be said that there are many changes occurred in the retail and fashion industries due
to the different aspects such as legislations, environmental, social and political effectively. It will
affect the business operations and activities within UK towards the retail and fashion industries
effectively (Blay-Palmer, 2016). There are various changes in the UK fashion industry such as -
 Chancing customer demands – The demand of customers changes frequently with respect
to different products and services, the demand of clothing and fashion also fluctuate with
time.
 Change in trends – The trend and preferences of customers are also changing along with
development of environment or culture.
 Development of technology – The technology is getting advance day by day and
customers are highly adopting internet and other technologies in their lives. Online
shopping is a major element that is influencing fashion industry.
PESTLE Analysis
In order identify changes in UK fashion market and business environment PESTLE
analysis can be applied as below -
 Political factors: The government is managing rules and regulations in order to control
health and safety, risk assessment and risk control. The political factors enable an
organisation to change and develop more effective strategies for the business, therefore it
can be said that changes in political factors such as government policies, strategies,
stability, taxes, environmental law and trade tariffs affecting the business of fashion retail
within UK. There is also such as example – Brexit which also influence organisation
operating in the global market (Clegg, Kornberger and Pitsis, 2015) Marks and Spencer
effectively focus on considering the political factors in the business environment, it offers
products to customers all around the world with respect to export policies.
 Economical factors: These factors affects the buying power of the customers, the
economic conditions or state of an area highly influence the sales and profit of the
retailers. Economical factors has a significant impact on the fashion retail industries in
terms of their business activities and profitability. Economical factors such as economical
growth, exchange rates, interest rates, inflation rates and foreign exchange rates. This will
also include the income of customers (Sweeney, Grant and Mangan, 2015).Marks and
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Spencer targets countries with higher economic conditions, the customers targeted by are
generally earning high level of income.
 Social factors: Social factors involve the beliefs and attitudes of UK population which
considered the population growth, career attitudes, age distribution and health etc. The
factors have their own interests individually and also direct impact on the fashion retail
industries effectively. In order to cope up with such social factors, managers of fashion
industries should analyse then customer demands and what will drive them efficiently.
The social factors highly influence the purchasing decisions of the customers as people
highly concerned with the social culture and beliefs. Marks and spencer designs and
develop clothes with respect to culture, trend, festive factors so that people can get
attracted towards their products.
 Technological factors: Technological factors refers to the innovations and changes in
technologies and techniques in order to enhance the business of fashion retail sectors
effectively. Technological changes affect the business in terms of new ways for
producing products and services, new ways to deliver items to the customers and new
ways to communicate with target markets effectively. Marks and Spencer utilises new
and innovative technologies in their stores as well as business activities such as online
payments, Elevators in stores, electronic stores etc.
 Legal factors: Legal factors include the involvement of government rules and
regulations in order to manage and control the fashion retail industry activities in the
market towards customers effectively. For an example, equal opportunities to the
employees, health and safety, consumer right, product safety and labelling (Dalkir, 2017).
In order to run businesses smoothly they should understand the legal factors that affects
the operations. In order to perform successful business functions and sustain market
position Marks and Spencer consider and implement each and every law in their business
such as employment laws, tax policies etc.
 Environmental factors: Environmental factors are nor become important that the
scarcity is increasing of raw materials, doing business as sustainable and ethical firm and
population targets (Hayes, 2014). There are few issues and problems of environmental
factors that a business faces. Tourism, agriculture and farming the best examples for
environmental factors but also not limited to the weather, climate, global changes and
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geographical locations effectively. Marks and Spencer conducts various programs and
campaigns for environmental safety and protection, its stores do not use polythene bags
as it can negatively affect the environment.
Thus, it can be said that changes in politics, environment, social, legal and technology
will affect the fashion retail business in UK. Fashion retail firms need to understand the various
changes in order to manage and control their business operational activities in UK and across the
country which will help them to increase their profitability and production effectively and
efficiently (Gillison, Northington and Beatty, 2014).
RELEVANT CHANGES WITHIN THE MICRO ENVIRONMENT
Changes from the micro environment on Marks and Spencer will be in the form of
strengths, weaknesses, opportunities and threats. This will be done by using SWOT analysis for
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Illustration 1: PESTLE Analysis
(Source : PESTLE Analysis, 2017)

the firm effectively (James, 2014). There are various factors in micro environment which are
influencing M&S's performance and profitability.
Porters five force for Micro analysis
These factors can be described as below -
1. Competitors – Due to increase in number of customers many new entrants have entered
in the fashion industry. The global fashion industry is developing intense competition as
companies are offering their products at cheaper rates for gaining competitive
advantages. M&S focus on sustaining its market position by offering high quality
products at low prices which assist in attracting more customers (Cornelissen and
Cornelissen, 2017).
2. Suppliers – The other main factor within micro environment are the suppliers, due to
increase in number of fashion retailers the power of suppliers have been increased. The
suppliers are very necessary for each and every company operating in any kind of
industry. They are providing necessary goods and resources for manufacturing effective
products and attract customers. Suppliers are increasing their cost of products for gaining
high rate profit within the competitive market.
3. Employees – The employees are most important assets of an organisation or company,
due to increase in competition fashion retailers are using effective strategies to attract
highly skilled employees and develop a strong workforce. M&S tried to recruit and retain
skilled and talented employees for their organisation to develop effectiveness and
efficiency within business functions (Leigh and Blakely, 2016).
4. Shareholders – The shareholders are those individuals which are investing funds within
profitable companies or businesses. According to current market conditions, fashion
industry is achieving high profit in the global market. Therefore, number of shareholders
interested in clothing or fashion industry day by day.
5. Customers – Customers are very important for making a business successful or
unsuccessful, therefore every company needs to identify the needs and wants of their
customers. The fashion trend is changing frequently along with customer's perception,
preferences and choices.
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RECOMMENDATION
In order to gain competitive advantages in the global market M&S needs effective
strategies which can support the development of efficiency in the business. There are various
which can be used by Marks and Spencer to increase sales and profit
Theories or approaches for M&S to gain competitive advantages
1. Pricing strategy– The companies can easily attract more customers by offering products
and services at low prices. It can help to gain high market share but it also develops lower
margins on each product. The low price strategy can be used by companies having high
economies of scale such as Marks and Spencer as it allows them to operate their business
at lower marginal cost as compared to their competitors in the market (Medberg and
Heinonen, 2014).
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I
llustration 2: Micro environment factors
(Source: Micro environment factors, 2017)

2. Marketing strategy – The large companies can also raise their marketing or advertising
budget easily. In order to retain the existing customers as well as attracting new ones
Marks and Spencer needs to use various new forms of marketing techniques or methods
such as online promotions, discounts and offers, social media marketing. Using online or
social media platforms can assist the company to interact directly with the customers and
build effective customer relationship within global market (Baldwin, 2017).
3. Market diversification – The another significant strategy that can be sued by M&S is
diversification. It means that the company can make innovative product in various
segments in order to gain popularity and high number of customers. The fashion industry
has a very high demand in the market, by increasing the product line a fashion retailer
such as Marks and Spencer can attract a huge number of customers in there market (Chen
and Fu, 2015).
4. Market segmentation – Another effective strategy which can be used by the organist is
market segmentation. In order to increase sales and profit within the market the company
can divide it into different segments by increasing the product line M&S can meet the
demands of customers in every segments.
CONCLUSION
The above report concluded that fashion and retail industries in United Kingdom is
growing day by day that people these days are more demanding towards fashion. The trend and
culture is changing very fast which is increasing the business of fashion retail businesses within
UK. The M&S sells cloths, luxury food products and home products to the customers. The firm
was founded by Michael Marks and Thomas Spencer in 1884. Currently the company has 979
stores across United Kingdom and 615 from them only sell food products. There are many
strategies and plans which will help business to improve their profitability and production in
order to enhance the brand awareness towards customers in the market.
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REFERENCES
Books and Journals
Blay-Palmer, A. ed., 2016. Imagining sustainable food systems: Theory and practice. Routledge.
Clegg, S.R., Kornberger, M. and Pitsis, T., 2015. Managing and organizations: An introduction
to theory and practice. Sage.
Cornelissen, J. and Cornelissen, J.P., 2017. Corporate communication: A guide to theory and
practice. Sage.
Dalkir, K., 2017. Knowledge management in theory and practice. MIT press.
Hayes, J., 2014. The theory and practice of change management. Palgrave Macmillan.
James, P., 2014. Urban sustainability in theory and practice: circles of sustainability. Routledge.
Leigh, N.G. and Blakely, E.J., 2016. Planning local economic development: Theory and
practice. Sage Publications.
Sweeney, E., Grant, D.B. and Mangan, D.J., 2015. The implementation of supply chain
management theory in practice: an empirical investigation. Supply Chain Management: An
International Journal 20(1) pp.56-70.
Baldwin, J., 2017. Designing the Brand Identity in Retail Spaces.
Chen, Y. and Fu, F.Q., 2015. The behavioral consequences of service quality: An empirical
study in the Chinese retail pharmacy industry. Health marketing quarterly 32(1) pp.14-30.
Desjardins, E., 2016. The Urban Food Desert: Spatial Inequality or Opportunity for Change?.
In Imagining Sustainable Food Systems (pp. 99-124). Routledge.
Gillison, S.T., Northington, W.M. and Beatty, S.E., 2014. Understanding customer bargaining in
retail stores: A customer perspective. Journal of Marketing Theory and Practice 22(2)
pp.151-168.
Kita, P. and Grossmanová, M., 2014. Reflection of Bratislava retail network in selected aspects
of consumer behaviour. Business: Theory and Practice 15 p.279.
Kotusev, S., Singh, M. and Storey, I., 2016. Enterprise architecture practice in retail: Problems
and solutions. Journal of Enterprise Architecture 12(3) pp.28-39.
Medberg, G. and Heinonen, K., 2014. Invisible value formation: a netnography in retail
banking. International Journal of Bank Marketing 32(6) pp.590-607.
Kita and Grossmanová, 2014Kotusev, Singh and Storey, 2016Desjardins, 2016
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Drucker, P.F., 2017.The Theory of the Business (Harvard Business Review Classics). Harvard
Business Press.
Online
Micro environment factors, 2017 [Online]. Available
through:<https://www.marketingtutor.net/micro-environment-definition-factors-example/>
PESTLE Analysis, 2017 [Online]. Available through:<https://www.ivoryresearch.com/wp-
content/uploads/2016/09/MS-Strategic-Analysis.pdf>
Appendix 1
PESTLE Analysis:
Political
1. Brexit
2. Taxes and tariff
3. Government
policies
Environmental
1. Climate
2. Resources
3. Environmental
policies and
regulations
Social
1. Customer's
perception
2. Customer
relationship
3. Cultural values
and beliefs
Technological
1. Internet
2. Social media
3. Online promotion
Legal
1. Sales act law
2. Employment laws
3. Legal regulations
Economical
1. Economic
conditions
2. Increase in cost
3. Lower per capital
income
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