Retail Theory and Practice

This document explores the theory and practice of retailing, focusing on topics such as PESTLE analysis, changes in the micro environment, strategies for adapting to the macro environment, and recommendations for success. It provides an overview of Marks and Spencer, discusses the impact of political, economic, social, technological, legal, and environmental factors on the retail industry, and offers insights into retailing strategies and tactics. Students can find study material, solved assignments, and essays on retail theory and practice at Desklib.

Retail theory and practice

Table of Contents
INTRODUCTION...........................................................................................................................3
Overview of Marks and Spencer ................................................................................................3
PESTLE analysis of M&S..........................................................................................................4
Changes within micro environment............................................................................................5
Strategies and tactics in adapting changes with influence of macro environment......................7
RECOMMENDATIONS.................................................................................................................9
CONCLUSION................................................................................................................................9
REFERENCES .............................................................................................................................10
Books and journals....................................................................................................................10

INTRODUCTION
In previous times, retail market is known as small store which provides goods and
services to customers at the place which is near to them and according to their needs and
requirement. But in today environment, this market is changed in small shaping malls,
supermarket and group of stores (Banerjee, and Mishra, 2017). Selling of quality goods to
customers is part of process in retailing sector which help firm in fulfilling requirement and
needs of customers for achieving organisational goals and objectives. Providing services to
customer by increasing profit of firm is the main motive of retail sector. In clothing sector, there
is rapidly changes in fashion which act as a challenge to retailer of this product. Here the retailer
have to adapt these challenges for surviving in competitive market and managing there
performance in this market. For this retailers have to study behaviour of consumers in market
and act according to it. There must be strong polices in organisation which can help firm in
getting he right decision and and take competitive advantage in market for boasting its
performance.
Overview of Marks and Spencer
Marks and Spencer is a British company which has its existence in UK form last 1884 .
company haver its main headquarter in Westminster, London. The company is dealing in fashion
products which it dells also its customers. This company was founded by Michael Marks and
Thomas Spencer. Company has its target consumers in united kingdom with more than 1000
stores. Company is also dealing in food product with 700 outlets in UK. Company gain its full
existence in 1998 where it become the largest retailer in united Kingdom. This attracted number
of investors towards firm and facilitate firm in expanding its operations (Chudik and Pesaran,
2016).
Trendy clothes is the main purpose of firm as it likes to attract costumes who want to
wear trendy clothes. Company use to innovate there products on regular basis which aid it in
getting more customer towards firm and maintain innovation with profitability. Maintenance of
goodwill in current market is the most important important part of firm business. M&S paying its
attention towards increasing there existing goodwill in market. Goodwill help firm in building
trust of customers on firm and maintain an intangible relationship between firm and customers.
M&S has established good plan for maintaining there staff motivation and perfection with help

of training and developmental. This will also help firm establishing its business in nations like
China, Germany and other nations (Hayes, 2018).
PESTLE analysis of M&S
It is that analysis which is used by firm in identifying external factors impact on business
of firm. This framework will study political, economic. Social. Legal, technical and environment
factors which have to be studied by firm.
Political: This factors are those which includes the government polices and procedures of
nation where firm is currently working by using its resources. This factor have its direct impact
on firms profitability and productivity. In context of M&S, it have to find out changes which
have implemented by government of respective nation. M&S has to clearly examine this because
it is dealing in number of nations where these changes in government polices is common.
Company have to use this features in formation of police for company for maintain productive
environment. These factors can be implemented of M&S by formation of polices according to
government needs.
Economic: These are those factors which include the factor related to economic
condition of nation where firm is working. These factors are exchange rates, interest rates and
many more. M&S is dealing in United kingdom where the per capita income of people is high.
This can be used by firm as using the products which are rich in quality and have innovation in
trend. Firm an use high profit percent because of rich people in society (Hübner, Holzapfel and
Kuhn, 2016). This will also aid firm in getting new and improvise product as it can spend more
on research of product.
Social: This factors are these which are related to social trend in firm which can impact
both negative and positively on M&S. Firm is dealing in faction product which are directly
related to the trend in society. This can be impact positively on M&S as firm is using innovation
in its process which help it matching trend in market. The negative impact of this on M&s is
regular innovation in products and change in stock can lead in rise of dead stock which act as
loss of profit.
Technical: These are those which incudes technological changes which can impact on
M&S productivity and profitably in long run. There is rapidly digitalization in industry which is
elimination old tools and techniques of production and functioning. This has positive impact on

firm as it will increase customer satisfaction. But it also act negatively on firm as regular change
in technological will impact on cost of firm (Karrholm, 2016).
Environmental: It include the factors which are related to atmosphere, climate. Pollution
in environment. These factors have to identified by M&S while making any plan this is because
it will help firm in increasing its values in mind of customers. For increasing its also and
customer attraction. M&S can implement this by making polices which are environment friendly
like no use of plastic bag in firm premises.
Legal: Legal factors are those which are related to legal requirements of firm which are
compiled law of that nation where firm is currently working this will help firm in coping with
government and will increase firms goodwill in market. Some time it will impact as negative on
firm because it have to use its make its process rigid and complex. M&S can implement this on
its functioning by using all the laws regarding employees benefits, customer rights for protection
of them from unethical practices.
Changes within micro environment
Consumer needs and want are changing rapidly in business environment which is causing
direct impact on micro environmental. These changes are related to supplier behaviour and many
more. This can put firm in situation of creating positive environment and help in solving number
of problems which may be arise in cores of action (Ko, Phau, and Aiello, 2016). Internal
environment of company can also act as the main reason behind the success or failure of firm
this is because it is using number of features in its working. For this firm can use SWOT analysis
which is mentioned below:
Strength Weakness
 Company have also an advantage of
departmentalization of its function
which facilitate it in getting more
knowledge about market place where it
is working and specificity identify
potential customer in target market.
These department are research and
development, Finance, operational
 Inability to penetrate successfully in
foreign markets acted as weakness of
firm this is because it is unable to
understand market of other nations and
facing huge loss there.
 Customer satisfaction in M&S is also
decreasing because of there difficult
return policy and lack of feedback in

sections and marketing.
 M&S can use new technology and tools
in its operations for facilitating
employee development and gaining
advantage in competitive world, this
will also facilitate firm in getting down
burden from its employee by use of
machinery instead of human in works
(Leigh and Blakely, 2016).
 For customer satisfaction company also
maintain its product quality at superior
level. Company haver to focus on
innovation in there business as it will
help it in matching the trends of in
society. This will also aid in analyse the
behaviour of customers in market for
attracting new customer towards the
firm product. Innovative products in
faction market always leads in increase
profitability of firm which help in
motivation of existing employee of firm
customer complaints.
 Supply chain of firm is also acted as its
weakness this is because firm is
providing its facilities globally but it is
unable to provide proper demand of
customers because of no warehouse
presence (Zellweger, 2017)s.
Opportunities Threats
 Customer have no fixed behaviour and
their taste and preference are
continuously changing so it is
important for M&S to study behaviour
of these customers and get
opportunities of increasing its market
share because of standardize product
(Miller and Goodman, 2016).
 Rising cost of raw materiel of firm can
cause it as the treat in market because it
have to increase its product pricers
which can lead in customer
dissatisfaction.
 Company is also facing threat of
polices of government of the different
nation where it is working because it

 Research ans development department
of firm can identify the product of its
major competitor which help firm in
getting know about the opposition
strategy and analyse its impact on firm.
may give arise to number of liability
according policy of governments of
respective nation (Pantano and
Timmermans, 2019).
Strategies and tactics in adapting changes with influence of macro environment
According to Popkewitz, 2018, approaches can be divided into various parts like, social,
cultural, resources, objectives, competition, economic, legal and political environment. So Marks
and Spencer have to take it, that organizational structure may effect it most. There is also threat
of new entrant in market of M&s where it is currently working. These new entrant will come
with more innovative product which can cause harm to existing market of firm because sifting if
employees towards organization. Company have to focus more on increasing its productivity and
profitability in business operation this will help it in surviving for long period of time. External
factor like government polices also have there impact on firm as it leads in regual chage in
polices and procedures of firm.
Cyclical theories
The wheel of retailing theory:
This theory was given Philip Kotler and states that new retailers in market should focus
on there product which is important for working of organization and for its long survival in
competitive market . In this context, some phases or steps are mentioned beneath: Step 1: Low prices, less margins and low reputation. Step 2: Heavy cost price, huge amount, good repute. Step 3: Under this, phase retailer sees profit gets increases without making any sort of
changes.
 Step 4: This stage belongs to same step as the first one when a new retailer enters the
phase.
M&S do there market research on regular basis which facilitate firm in getting
knowledge about new entrant in market ,this will help firm in maintain there product quality
according to other firm product.
Accordion theory:

This is the theory which aid the retail store owner to identified the changes which are
happening in environment of its business where firm is working. This is the mixture of store
with great mixture to specified shop and then again to wide assortment institutional sales outlet
which have to be studied carefully. This theory have been adapted by M& S in order to make
effective decisions to achieve the targets in effective way(Rao, 2019).
By the change in technology the firms are getting more comparative which aid them in
setting new objective with opportunity of more growth and innovation. New tools and method
can give numerous solutions to authorities by which large decisions can be made by time to time.
consumer are the prime motive of firm so their needs will be identified time to time for benefit of
firm . This is the liability of firm to find the needs and wants of firm that how they can help their
customer in satisfaction which is clearly understand by M&S. After this firm will get the
opportunity ti lunch their products according to needs of firm, and manage their working
environment. These factors are either "macro environmental" or "micro environmental" forces.
Macro environmental elements are across-the-board as they include concepts like demographics,
economics, political and legal factors, social and cultural factors, technology and the natural
environment. On the other side micro environmental forces are those that are distinct and
individual, such as marketing intermediaries, customers, producers, public entities and the
company itself ( King, Spark and Wang, 2016).
Retailing ideas
M&S is operating from several year which have helped it in maintain good bran name in
market. And this is the reason behind easy alterations in cost price of firm clothes and other
faction products. Some of important idea which can reduce cost are mentioned below:
 Social Media: M7S can use this social media as there main tools for promotion , this is
because it have lowest cost for promotion of firms product.
 Website: M& S has already have a website but they also need to start selling their
products through online basis.
 Business Partnerships: firm an use other organization as a tool of promoting its product .
This is because firm can combine with other firm which have already selling its product
in market (Waldman and Jensen, 2016)
 . This will help in maintaining cost of product.

RECOMMENDATIONS
The report mentioned above states that firm have various impact of external and internal
environment on its function but it have to clearly examine that what tools it can use in for coping
these environment. M&S can use tools like digital marketing and promotion of product on social
media which will help firm in getting excess to new market. Firm have number of opportunities
which can be used by it to deal with customer dissatisfaction. Firm have to use good plan and
effective strategies which can help firm in getting advantage external environment, political
factors have huge impact on firm so they must be used by firm with full care. This is
recommendation for Mark and Spencer that innovation in faction product should not be stopped
by firm as it facilitate then in attracting more customer but firm have to ensure good supply chain
management. M&S have good brand image in market which can be used by firm in building trust
of employee as well as customer in market place(Wang, Tsai, and Lin, 2016).
CONCLUSION
From the above mentioned report, that retail firms are growing there business rapidly.
They are continuously making changes in there faction products as well as functioning with help
of studying behavior of customers in targeted market. Firm also getting benefit of increasing
productivity and profitability if it use this function in their structure. For improving firms
performance and getting the customer towards organization firm can use its function in diction of
maximizing there product's quality. A good plan can ensure profitability of firm in global
environment and lead in achievement of goals and objectives. So firm have to make clear
objectives and identify the key market roles of both external and internal environment which
leads in profitability of firm in long run.

REFERENCES
Books and journals
Banerjee, M. and Mishra, M., 2017. Retail supply chain management practices in India: A
business intelligence perspective. Journal of Retailing and Consumer Services, 34.
pp.248-259.
Chudik, A. and Pesaran, M.H., 2016. Theory and practice of GVAR modelling. Journal of
Economic Surveys,30(1).pp.165-197.
Hayes, J., 2018. The theory and practice of change management. Palgrave.
Hübner, A., Holzapfel, A. and Kuhn, H., 2016. Distribution systems in omni-channel retailing.
Business Research, 9(2).pp.255-296.
Karrholm, M., 2016. Retailising space: Architecture, retail and the territorialisation of public
space. Routledge.
Ko, E., Phau, I. and Aiello, G., 2016. Luxury brand strategies and customer experiences:
Contributions to theory and practice. Journal of Business Research, 69(12), pp.5749-
5752.
Leigh, N.G. and Blakely, E.J., 2016. Planning local economic development: Theory and
practice. SAGE publications.
Miller, R. and Goodman, C., 2016. Performance of retail pharmacies in low-and middle-income
Asian settings: a systematic review. Health policy and planning, 31(7), pp.940-953.
Pantano, E. and Timmermans, H., 2019. Smart Retailing. Springer International Publishing.
Popkewitz, T.S. ed., 2018. Critical studies in teacher education: Its folklore, theory and
practice. Routledge.
Rao, S.S., 2019. Engineering optimization: theory and practice. John Wiley & Sons.
So, K.K.F., King, C., Sparks, B.A. and Wang, Y., 2016. Enhancing customer relationships with
retail service brands: The role of customer engagement. Journal of Service
Management, 27(2).pp.170-193.
Waldman, D.E. and Jensen, E.J., 2016. Industrial organization: theory and practice. Routledge.
Wang, J., Tsai, C.H. and Lin, P.C., 2016. Applying spatial-temporal analysis and retail location
theory to public bikes site selection in Taipei. Transportation Research Part A: Policy
and Practice,94.pp.45-61.
Zellweger, T., 2017. Managing the family business: Theory and practice. Edward Elgar
Publishing.
(Banerjee, and Mishra, 2017)(Chudik and Pesaran, 2016)(Hayes, 2018)(Hübner, Holzapfel and
Kuhn, 2016)(Karrholm, 2016)(Ko, Phau, and Aiello, 2016)(Leigh and Blakely, 2016)
(Miller and Goodman, 2016)(Pantano and Timmermans, 2019)(Popkewitz, 2018)(Rao,
2019)( King, Spark and Wang, 2016)(Waldman and Jensen, 2016)(Wang, Tsai, and
Lin, 2016)(Zellweger, 2017)