Analysis of Business and Business Environment for M&S Retail Company

This report provides a comprehensive analysis of Marks & Spencer (M&S) and its business environment. It begins by examining the purposes and legal structures of private, public, and voluntary firms, using M&S as a case study for a private firm. The report then explores the size and scope of M&S in comparison to other business units like the Best Friends Animal Society. It assesses how different organizational functions contribute to achieving M&S's mission and goals, emphasizing the importance of coordination between departments like R&D, manufacturing, marketing, and HR. The report further evaluates the positive and negative impacts of macro factors on M&S's operations, utilizing PESTLE analysis to examine political, economic, social, technological, legal, and environmental factors. It highlights how supportive tax policies, economic growth, changing customer preferences, technological advancements, and environmental concerns influence M&S's strategies. Finally, the report conducts a SWOT analysis to determine M&S's strengths, weaknesses, opportunities, and threats, and links these internal factors with the external macro factors, providing a holistic view of M&S's business environment and strategic positioning.

Business and Business Environment

TABLE OF CONTENTS
INTRODUCTION......................................................................................................................1
TASK 1......................................................................................................................................1
P1 Stating the purpose of public, private and voluntary firm along with the legal structure.1
P2 Size and scope of M&S and other business unit...............................................................3
P3 Assessing the extent which different functions of organization helps in achieving
mission and goals...................................................................................................................3
TASK 2......................................................................................................................................4
P4 Evaluating positive and negative impact of macro factors on business operations..........4
P5 Conducting SWOT analysis to determine strength and weakness....................................6
P6 Assessing manner in which strengths and weaknesses are related with macro factors....7
CONCUSION............................................................................................................................7
REFERENCES...........................................................................................................................9

INTRODUCTION
Business environment implies for the conditions or situations in which firm operates
and perform activities as well as functions. In the present era, quick and high level of changes
take place in business environment which in turn has direct impact as well as significant
impact on operations. In this regard, manager of the firm is required to develop strategic
framework by analyzing both internal and external factors. The present report is based on the
case scenario of M&S which has 1433 stores all over the world. Such retail firm offers wide
range of quality products to the customers at affordable prices including home, food, clothing
etc. In this, report will shed light on the level to which motive of different types of business
unit differs from each other. Besides this, it will describe how organizational functions are
interrelated with vision and organizational goals. Along with this, report also highlights the
strengths and weaknesses of M&S. Furthers, it also entails the manner in which macro factors
are linked with the strength and downsides of M&S.
TASK 1
P1 Stating the purpose of public, private and voluntary firm along with the legal structure
Vision, mission as well as objectives may be served as pathway which provides
direction to the firm and helps in developing strategic framework. Thus, each business unit
sets some objectives for attaining success in the market over rival firms. However, goals and
motives of business organizations differ according to their nature in terms of public, private
and voluntary. Along with this, legal structure of firm is highly dependent on its nature to a
great extent. Thus, purposes of different types of business unit vary in the following manner:
Private firms: M&S is recognized as private firm that issue shares to the stakeholders and
listed on London stock exchange such as FTSE 100. In this, majority or whole of stake is
held by private entities. Thus, it is the main reason due to which M&S is characterized as
private firm.
 Vision: This statement of M&S includes ‘To become a standard against which
performance and position of others are measured.’ This aspect shows that company
wants to set its activities as a benchmark that other companies wish to do the same
(M&S’s mission statement and what are its core values, 2017). Hence, vision is

development of competitor’s aspiration in relation to gaining the similar quality that
maintained by M&S.
 Mission: In this regard, M&S statement highlights “Plan A” because there is no plan
B. In other words, it can be said that in the upcoming five years business unit will
focus on attaining 5 commitments such as climate change, waste, sustainable raw
materials, fair partners and health. M&S wants to create its distinct identity in retail
world by focusing on sustainability aspect.
 Purpose: Increasing sales revenue and market share in the field of retail is the main
objectives of M&S. Along with this; another main objective of M&S is to
differentiate its offering from others by making focus on quality and innovation.
 Legal structure: For ensuring smooth functioning of operations M&S undertakes
hierarchical structures. In accordance with such legal structure there are several
departments such as finance, marketing, HR etc made. Manager of each department is
responsible to monitor performance of their area and give report to higher
management team (Prajogo, 2016).
Public firms: Postal services holding company Ltd fall into the category of public firm
whose vision, mission and objectives are as follows:
 Vision: Company wants to build leading position in the postal sector by performing
all the activities in a sustainable way.
 Mission: To offer quality postal and logistics solutions to the customers.
 Purpose: Objective of Postal services holding company Ltd is to offer innovative
banking products or services to the customers that make value addition in their
money.
 Legal structure: Postal services holding company Ltd follows flat structure. In this,
personnel work as per the responsibilities assigned by the government authority.
Voluntary firms: It includes firms or individuals who voluntarily make their efforts to
offer benefit to the people of society and animals. Such kind of business unit works without
any motive pertaining to earning profit. Best Friends Animal society is UK firm which work
for the protection and security of animals.
 Vision: Company’s vision is to build a better world by showing kindness towards the
animals. Hence, vision of Best Friends Animal society is to place dogs and cats into
good homes that are considered as unadoptable.

 Mission: Best Friends Animal society is focusing on creating a grassroots network of
people and organization that shows high level of care towards animals.
 Purpose: The main objective of such voluntary firm is to provide pets or animals with
high level of protection. Company is working for developing feeling of care among
others which in turn ensures security to pets.
 Legal structure: Flat structure is followed by Best Friends Anima Society. In this, by
delegating roles and responsibilities, all the members of such voluntary group perform
activities for the welfare of pets.
P2 Size and scope of M&S and other business unit
Size and scope of M&S
M&S is multinational company because it operates in the different parts of world
around more than 40 countries. In accordance with such aspect it can be said that size and
scope of M&S is wide. As business unit operates worldwide which in turn enables it to
maximize both productivity and profitability by offering services to the large number of
customers. Further, business unit also has opportunity to explore business operations in
developing countries and thereby enhance both size as well as scope of operations.
Size of scopes of Best friend’s animal society
By doing assessment, it has been assessed that Best Friend Animal Society is
considered as local company. It also organizes some programs at national level regarding
protection or security of pets. Hence, referring all such aspects it can be presented that size
and scope of such business unit is not too wide in comparison to M&S. The rationale behind
this, such firm takes initiative for pet protection within the national boundaries.
All the above aspects clearly present that size and scope of multinational companies
are wide over others to a great extent.
P3 Assessing the extent which different functions of organization helps in achieving mission
and goals
Effective co-ordination is the key which helps firm in achieving mission and
objectives to a great extent. In the competitive environment, business organization can meet
its goals only when all the departments cohesively work with each other. M&S vision and
mission tends to make more focus on sustainable business activities. In this regard, R&D
department of M&S is responsible for finding the cost effective ways to perform activities in

a sustainable ways. On the other side, manufacturing department of firm needs to follow all
the guidelines while performing activities and functions (Chattopadhyay and Bhawsar, 2017).
Further, maximization of sales and profitability is another main objective of M&S. For this
purpose, marketing department is required to develop awareness among the customers by
organizing promotional campaign. In this, finance manager provides information to the
authority of marketing department about how much fund is available or allocated for
advertisement.
Along with this, main objective of M&S is to offer satisfactorily services to the
customers which may turn into loyalty in the near future. Hence, for achieving such objective
HR manager needs to appoint highly skilled and talented personnel for the concerned job. In
addition to this, HR manger requires to organize training and development session for
personnel (Jaakkola and et.al., 2016). By doing this, firm can enhance competency as well as
proficiency level of personnel to a great extent. At operational level, manager is required to
ensure that employees are performing activities in accordance with the training provided to
them. Hence, referring all the above mentioned aspects it can be stated that function of each
department makes significant contribution in the achievement of goals.
TASK 2
P4 Evaluating positive and negative impact of macro factors on business operations
Macro environment implies for the factors on which business unit has no control and
for dealing with the same strategic framework is required. Hence, for the development of
sound strategies and policies firm requires information regarding external or macro
environmental aspects (Bhowmick and Prasad, 2017). Thus, to identify the negative and
positive impact of macro aspects on business operations PESTLE analysis has been
conducted. This in turn furnishes clear information about tax policies, economic condition,
legal framework, technological advancements etc. Hence, by conducting PESTLE analysis
and evaluating macro aspects M&S would become able to prepare competent framework:
 Political factors: By doing assessment of political factors, it has assessed that tax
policies of UK are highly effectual and supportive. Tax is one of the main factors
which have direct impact on profit margin (Eling and Schaper, 2017). In this context,
it can be said that supportive tax policies will enhance profit margin of M&S to a
great extent. Along with this, now companies take initiative for the welfare of others

with the motive to build distinct image in the mind of customers. M&s has also
performed CSR activities to develop effectual image in the mind of society. However,
there is a lack of guidelines in relation to sustainable energy efficiency which in turn
places closely influences initiatives undertaken by M&S. Moreover, due to this,
investors are not in position to assess the company which has positively contributed in
sustainability aspect.
 Economic factors: In the current times, quiet decent growth has been found in the
economic condition of UK. Present economic condition of UK can be characterized
with the aspect of low unemployment and inflationary trends. This is a good indicator
of M&S because customers prefer to spend more money on luxurious items when
their income level is high. In this regard, situation of low unemployment will
positively contribute in the revenue and profit margin of M &S. On the other side, if
UK takes decision or voted to leave EU then economic condition will be affected
negatively. This in turn closely impacts financial aspects of firm and thereby overall
success.
 Social factors: Now, high level of changes takes place in the customer taste and
lifestyle which in turn has both opportunities as well as threats for the industry.
Recessionary condition which occurred in the period of 2008-09 highly affected the
behaviour of customers. Now, households prefer to purchase products or services
from the retailer who charges lower prices. In this regard, M&S can entice the
decision making aspect of customers by offering products or services to them at
discounted prices. This aspect highly impacts profitability aspect of M&S and
thereby overall financial position. Along with this, now focus of customers is
increased towards eco-friendly products and sustainable environment. By considering
this, M&S is placing high level of emphasis on the aspects of reuse, recycle and
reinvent for making business activities as well as operations more efficient.
 Technological factors: Method or retailing trend is changed over a time frame to the
significant level. Now, customers prefer to do shopping of products or services via
internet. On the basis of such aspect, by offering quality products or services to the
customers through the means of online network M&S can gain competitive edge over
others (Social and Technological Factors Affecting Marks & Spencer, 2017).
However, on the critical note, now there are several customers who hesitate to do
online shopping due to security issues. Thus, it is one of the main aspects which in
turn place negative impact on the growth of online business.

 Legal factors: Laws and legislation are changing with the very high pace which in
turn closely influences business activities. For instance: UK government introduce
guidelines as well as rules and regulation pertaining to Food, Health & Safety. This in
turn has significant impact on business as well as product policies. Along with this, in
the case of new updates, firm is also required to conduct or organize training activities
for personnel (Schaper, 2017). All such aspects create issue and impose cost in front
of firm. However, by adhere with the legislation or legal aspects firm can enhance its
brand image and market share.
 Environmental factors: Creation of sustainable environment becomes the main
priority of government, customers and companies. Along with this, customers select
retailer for the purpose of shopping who perform activities in a eco-friendly manner
(Marks and Spencer PESTEL and SWOT analysis, 2017). Thus, by taking into
account such aspect M&S have started its green policy such as ‘Plan A’. Hence, M&S
is making hard efforts to become carbon neutral, zero waste to landfill and ethical
trading firm. All such activities will assist company in developing effective image in
the retail sector and among the people of society. On the other side, for identifying
sustainable ways to perform activities business organization needs to make focus on
R&S and invest money in high-tech equipments. All such aspects impose cost in front
of M&S and impact its profitability.
P5 Conducting SWOT analysis to determine strength and weakness
For building competitive position and taking strategic move over other firm must have
information about its strengths as well as weaknesses. Moreover, without having information
regarding such aspect firm would not become able to determine what needs to be
strengthened or overcome. By considering such aspect internal analysis of M&S has
conducted through the means of SWOT analysis.
Internal analysis

External analysis
(Source: Marks and Spencer SWOT Analysis, USP & Competitors, 2017)
Strengths: M&S has attained leadership position in the clothing sector over all the
other departmental stores. In addition to this, strong brand equity position has built by M&S
which is considered as its main strengths. Company also takes several initiatives for the
welfare of others which in turn creates its distinct image in the mind of customers (Marks and
Spencer SWOT Analysis, USP & Competitors, 2017). M&S makes more focus on offering or
delivering quality services at appropriate price level. All such strengths assist firm in build
and sustain competitive position over others.
Weaknesses: By doing SWOT analysis, decreasing sales pattern has been identified in
the context of food offering. Moreover, firm does not have scale to compete with the leading
retail organizations such as Tesco, Sainsbury etc. Further, due to high competitive situation
M&S is facing difficulty in capturing high market share. In addition to this, company lays
low level focus on automation pertaining to stock control and other activities which in turn
may result into high cost. Besides this, firm fails to make effectual use of waste store space
which is another main weakness of M&S.

Opportunities: In the recent time, online shopping activities or aspects are
flourishing in UK market with the very high pace. On the basis of such aspects, by
strengthening online business system M&S can enhance revenue to a great extent. Apart from
this, M&S has opportunity to take entry in developing countries like India and China which is
now considered as fastest growing markets. In addition to this, by introducing new market
segment business unit can generate more profit margins. Hence, by undertaking all such
strategies M&S can fulfil its aim and objectives.
Threats: Other retail business units namely ASDA, Tesco, LIDL etc act as a threat in
front of M&S because they offer products or services to the customers at discounted prices.
Due to this, M&S is also pressurized to offer products to the customers at lower price to grab
high market share. This aspect cuts profit margin of M&S and places negative impact on the
financial position of firm. Changing government policies and process also imposes challenge
in front of M&S. Moreover, when government makes changes in employment and other laws
then firm has to make huge modifications in the existing framework. Thus, for mitigating
such threats firm should lay emphasis on developing competent and flexible policies or
strategies.
P6 Assessing manner in which strengths and weaknesses are related with macro factors
Both macro and micro factors are highly associated with each other so M&S should
analyze the same for achieving success. Macro environment evaluation shows that mow
customers tend to make more focus on price level as compared to other factors. Hence, in
this, firm can attain success only when it provides customers with quality products at
discounted prices (Prajogo, 2016). Along with this, SWOT analysis exhibits that firm is
facing problems in competing with the leading brands that known as discounted leaders
namely Tesco, ASDA etc. This aspect shows that, social factors and weakness of M&S is
highly interrelated.
Along with this, after the recessionary period value for money became the focal point
for customers. In accordance with such aspect M&S started to provide high quality services
to the customers. Beside this, with the motive to fulfil the needs and expectation of customers
M&S provide them with wide range of products or services. Further, environmental factors
show that now green environment becomes the priority of stakeholders pertaining to each
company (Prajogo, 2016). By keeping such aspect in mind M&S has taken several initiatives

for the welfare of others. All the above depicted aspects clearly presents that macro factors
have significant influence on internal elements either in a positive or negative way.
CONCUSION
By summing up this report, it has been articulated that different types of business
units persue varied goals and objectives. Besides this, it can be inferred that profit
maximization and enhancement of customer satisfaction as well as loyalty is the main
motives of M&S. Besides this, it can be inferred that size and scope of M&S operations is too
wide over public & voluntary firms. It can be summarized from the report that function of
HR, marketing, production & operations are highly linked with each other and make
contribution in the attainment of goals. It can be seen in the report that by al the macro factors
have significant impact on M&S operations in both positive as well as negative way. Along
with this, it can be concluded that macro factors closely influence strengths and weaknesses
of M&S. Thus, by analyzing both internal as well as external factors and taking strategic
action business unit can contribute in the attainment of organizational gaols significantly.

REFERENCES
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