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Understanding Business Failure in International Market

   

Added on  2020-10-05

12 Pages4149 Words193 Views
Understanding BusinessFailure

Table of ContentsINTRODUCTION...........................................................................................................................1MACRO ISSUE ..............................................................................................................................1Issue 1 Lack of good quality standard products in comparison to sustainability principles.......1Issue 2 Unable to manage technological upgrade with entry of new competitors......................2MESO ISSUE..................................................................................................................................3Issue 1 : Unable to maintain unique identity in case of tough industry competition..................3MICRO ISSUE ...............................................................................................................................4Issue 1 Marks and Spencer failed to build strong brand image in international market.............4Issue 2 Unable to meet unique needs of customers in cost effective way..................................5Issue 3 Lack of clarity over design policy and clear retail positioning.......................................5TURNAROUND STRATEGY .......................................................................................................7CONCLUSION................................................................................................................................8REFERENCES................................................................................................................................9

INTRODUCTIONBusiness failure refers to the company that ceasing the operation following the inabilitythat makes a profit and business did not bring enough revenue that covers the expenses. Suchthat on the other side, when the business did not generate the adequate amount of cash flow inorder to meet the expenses. In the same way, the chosen firm for the report is Marks and Spencerwhich is established in 1881 and it is one of the biggest leading multinational company whichprovides food, home and clothing at offline and in its online stores. The report also helps tounderstand some micro, meso and macro issues which leads to affect the business towards down.Further, the present study also describe the strategy that helps to overcome the issues and createspositive impact upon business as well and that is why it uses Contraction Strategy, which is acompetitive strategy deployed by large organizations for withdrawing from market segments.MACRO ISSUE Issue 1 Lack of good quality standard products in comparison to sustainability principlesIt is the first macro issue that lead a business towards down such that as the companyprovides best quality of products to their customers but it did not provide products which followthe sustainable principles. For instance, Marks and Spencer did not have clear retail positioningas well as design policy, as a result, it did not have long term sustainable for its operating indifferent markets. Further, the quoted firm also did not properly address in many overseas marketas well. It has been further analyses that for maintaining brand image in market, it is quiteessential for the firm to provide best quality of products to their customers and also make surethat the products are met with a sustainability principles as well (Kuo and Wang, 201). Becausenow a days, people uses those products which are eco- friendly but on the other side, Marks andSpencer did not uses the packaging products which did nit affect the environment, as a result, italso leads to affect its business financial performance. Thus, it also creates a long issue for thebusiness failure in past times. Further, it is also evaluated that the sustainability principles fordesigning a products always make sure that the material which are used during manufacturingshould be recyclable and it also leads to zero waste as well. But in the context of Marks andSpencer, the firm is fail; to comply with such principles. It is so because, earlier it did not usesrecyclable products and if it uses mixed and recyclable material in its manufacturing process thenit will help to reduce the product cost (Halldórsson, 2019).1

Apart from this, the sustainability principles also relies with durable design solutions andit also reach to zero waste in which the products have to either be durable for long time and befully recycled or transformed into new products. But Marks and Spencer did not comply withsuch and as a result, the business also fails because of not producing the products as eprsustainability principles (Aubin and et.al., 2019). Now a days, people are become more healthconscious and that is why they are prefer the organic products but on the other side, Marks andSpencer still providing some inorganic product that affect the sales of a business in negative wayas it affect the people health in negative way. Issue 2 Unable to manage technological upgrade with entry of new competitorsIn 2002, Marks and Spencer also faces another micro issue that leads to affect thebusiness and is a reason of business failure as well. Such that the firm did not have the ability totechnology upgrade its own business when a new competitors are entered into market with newand advance technology. But on the other side, quoted firm still relies on old system which leadto fell behind. For example, its rival firm such as TESCO uses online marketing tool in order topromote its business product, and also uses some Automatic pay system that helps to save timeand did not force a firm to spend extra cost on it (Jimenez, Valdes and Salinas, 2019). While onthe other side, it has been analyzed that Marks and Spencer still uses old traditional method ofpromotion and it did not even introduce its new online system and lower down the number ofhuman resources. This shows that the company did not have the managers who have knowledgeto upgrade its entire system by using advance technology into working area. That leads tosuccess, but is just opposite in the case of Marks and Spencer.In addition to this, it is also analyzed that using advance technology provides differentopportunities to the business to move forward and sustain it brand image as well. That is why,when the company wants to enter into new market, it uses some advance and unique strategy,which is not available in existing firms (Zhao and Li, 2019). But due to lack of human resourcewho have knowledge regarding the new and advance technology, Marks and Spencer did notcomply with such techniques and as a result, it leads to fall in its business as well. Therefore,due to not adopting advance techniques into working area, there are many stores which shutdown and this period clearly known as a crisis in the company along with its internationalbusiness as well. As new company enter into market with using unique identity and techniques2

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