International Business Strategy Report: Marks and Spencer Case Study

This report analyzes the international business strategy of Marks & Spencer (M&S), a British multinational retail company. The report begins by exploring the influence of external factors on organizational strategy formulation and implementation, emphasizing the use of PESTLE analysis to understand political, economic, social, legal, technological, and environmental factors. It then examines how these factors affect M&S's operations in various countries, highlighting the complexities of adapting to different market conditions. The report also includes a SWOT analysis of M&S in relation to its competitors, identifying its strengths, weaknesses, opportunities, and threats. The analysis covers brand image, customer base, financial health, and competitive advantages such as store locations and product range. The report concludes by summarizing the key findings and their implications for M&S's strategic decisions in the global market.

International
Business Strategy

Table of Contents
INTRODUCTION ..........................................................................................................................1
MAIN BODY ..................................................................................................................................1
a) Do you agree that external factors influence organisational strategy formulation and
implementation............................................................................................................................1
b) Prepare a SWOT analysis, in relation to its competitors........................................................5
CONCLUSION ...............................................................................................................................8
REFERENCES................................................................................................................................9

INTRODUCTION
Business Strategy is the set of the actions and decisions that the business undertakes so as
survive effectively within the competitive market place as well as to attain the organisational
goals in a proper manner. Therefore it is a type of blue print which helps the business managers
within the organisation to attain the desired ends in a particular way. Moreover international
business strategy refers to the proper set of plans so that commercial transactions which is taking
place between entities in different countries (Bang, Joshi and Singh, 2016). Chosen organisation
for the report is Marks and Spencer, which is a British multinational retail company,
headquartered in London. It specialises in providing high quality clothing, home as well as
various food products. This project is based on whether there is a influence of the external
factors on the organisational strategy formulation and implementation. In addition to this it also
discusses SWOT analysis in relation to its competitors.
MAIN BODY
a) Do you agree that external factors influence organisational strategy formulation and
implementation.
As the chosen organisation for the report is Marks and Spencer, which is a specialised
retail company provides clothing, food and luxurious food products. Being a decision maker
within the respective organisation it is necessary to analyse the external as well as the internal
factors so as to frame effective strategy and survive in this competitive world.
Yes, it is determined that external factors has a great influence on the organisational
strategy formulation and implementation. As external factors are present outside the environment
and has a great influence towards the formulation and implementation of strategy. In order to
determine the influence of the external factors it is necessary to conduct PESTLE Analysis,
which is described as follows-
PESTLE Analysis- It is a effective framework or a tool which is used by the managers to
analyse as well as monitor the macro environmental factors, that impacts the performance of the
organisation. This tool is effectively used by the business while entering into a foreign market
and thus frames effective strategy by analysing the external environmental factors.
 Political Factors- These are the activities related to government policies and
programmes that has a effect on the performance of the company. Therefore it creates
1

problem for the respective company to frame effective strategy , because of the different
political conditions within the countries. As marks and Spencer has its branches all over
the countries , it becomes difficult for them to abide with all the governmental regulation
and therefore conducts its business activities in a appropriate manner. Specifically there
are changes in the government policy in various sections such as trade policy, labour law,
import and export restrictions (CastellóEtter and Årup Nielsen, 2016). This causes
difficulty for the manager to frame effective strategy so as to enter its business in the
international market. Moreover government also has a set of its own rules and regulations
and respective company faces problem in formulating and implementing strategy. In
addition to this there are varied differences in health and safety measures in different, this
creates issue for the manager at Marks and Spencer to follow different rules in providing
food products to the customers in different countries. This is the reason that external
factors has a great influence on the organisational strategy and implementation (Wu,
2016).
 Economic Factors- This is the factor which is considered with the economical condition
of the country and has a direct impact towards the performance of the company. As with
the rise of inflation rate within the economy of UK, It will lead towards the increase of
prices of company's products and services and would ultimately affect the purchasing
power of the customers. Moreover this leads to reduced in the demand of the products
and services and this would cause a negative effect on the performance of the company.
In addition to this, it can also be analysed that different countries have different
economical condition which makes difficulty for the management at Marks and Spencer
to frame different strategies according to the economical condition of the country.
Therefore it becomes necessary for the company to analyse the economical state of the
economy, GDP, inflation and employment level within the country so that proper
marketing plan and effective strategies could be develop so as to properly conduct the
business in the international market. Therefore as the current economic condition of UK
is favourable which is a proper healthy sign for the economy, therefore company should
properly frame strategies related to fashionable clothing so as to sustain in the market for
a long time period (Ghemawat, 2016).
2

 Social Factors- Social factors are the external business environmental factors and has a
major influence towards the working and the operation of the company. These are the
factors which is considered with the change in the demand and requirement of the
customers, due to differences in the demographic factors as well as changing lifestyle of
the people in different countries. Moreover, it can be said that as Marks and Spencer
operates in various countries like in international market, people prefers to buy western
clothes, which is not generally accepted by the Indian customers, they believe more in
ethnic clothing. Thus this factor creates problem for the firm to frame strategy for the
international as well as the local market. From this it is determined that external factors
has a great influence towards the strategy formulation and implementation (Habib and
Hasan, 2017). As differences in the demographics and the attitude factors makes it
difficult for the manager within the company to provide different goods in different
countries and therefore forming of the different strategies makes its complex process for
the respective company (Vij and Bedi, 2016).
 Legal Factors- These are the factors which are present outside the business organisation
and affects the performance and the strategy formulation of business. Moreover legal
regulations and laws are been properly enacted and followed in the retail industry. When
the respective company follow the legal rules and regulations it will assist them to
manage their business activities in an appropriate manner. But in contrast to this there are
different rules and regulations which are different in the various markets at the
international level. Their are some of the key legislations which includes sales of goods
act , consumer protection from Unfair trading regulations , therefore there are many other
laws which prevent the customers from being mistreated and therefore will lead the
organisation to properly sustain in the global market. But due to differences in the legal
laws and legislations it creates a problem for the manager of the company to devise and
frame effective strategies to sustain in the international market for the long time period
(Jarzabkowski and et.al., 2016.).
 Technological Factors- In the modern era, with the rise in advanced technologies it is
necessary for the organisations to adopt to the advancements in technology so as to
conduct the business activities in a proper manner. Moreover it has allowed the business
to operate efficiently in the competitive market as . In context to specific retail industry it
3

has enhanced the productivity of the company as well as leads to lower cost. Moreover by
adopting the advanced technology it has assisted the company to adopt to online
shopping mode and moreover leads to reduce the supply cycle of the products. Therefore
it also leads difficulty for the firm to formulate and implement strategy as it operates in
various countries it becomes difficult for the company to adopt to different technology
advancements and this will lead to a costly process for the company so as to formulate
different strategy while operating in different countries. Moreover it also becomes
difficult for the respective company to abide to different technological advancements in
different countries and makes it difficult for them to properly implement proper
strategies. Moreover there is difficulty for the respective company to manage the
positioning of the brands in an effective manner (Kourula, Pisani and Kolk, 2017).
 Environmental Factors- It is considered to the fact that business activities of the
organisation should be conducted in an appropriate manner thereby minimising the harm
on the environment. As marks and Spencer operates in various countries, in which it
becomes necessary for them to follow and adopt the different international environment
so as to compete effectively and therefore maintains its sustainability in the business for a
long time period. Therefore it becomes necessary for the respective companies to adopt to
change and provides finished goods in such a way that doesn't impact the brand image of
the company in the global market. In context to this, in order to meet the eco friendly
criteria Marks and Spencer has adopted to Green policy so as to provide non carbon
products as well as leads to zero waste and adopt to ethical trading practices so as to
promote its business in a positive manner. But in spite of this, it creates difficulty for the
company to adopt to effective strategy as there are various environmental laws which are
prevailing in the countries and makes difficulty for the respective company to formulate
different strategy to enter into the different market. As operating in UK, Marks and
Spencer sets a deadline to eliminate all the hazardous chemicals from their production
work. Therefore this is not necessary for the company to set the policy of environment
protection while operating in different countries within the international market. This
creates complex the task of the manager at the respective retail company to form and
implement different strategies within the different countries and therefore leads to the
complexity of the business activities (Luo and Bu, 2018).
4

From the above discussion it has been analysed that business environment factors greatly
influence the formulation as well as implementation of the strategies, because of the varied rules
and regulations as well as differences in the demand and requirement of the customers. This
arises problem for the organisation to frame and implement different strategies in different
countries. Therefore in order to reduce the influence of the external business environmental
factors. It is necessary for the management within the respective company to analyse the
different factors so as to take effective decisions regarding the formulation and implementation
of strategy. This would assist the respective business to sustain in the global market for a long
period of time.
b) Prepare a SWOT analysis, in relation to its competitors.
It is necessary for the business organisations to analyse the strengths and weakness of its
firms so as to frame proper strategies in order to ensure proper survival of the business in the
market for the long run. Therefore SWOT Analysis is the effective tool or the proper strategic
planning technique which helps the business managers to identify strengths, weaknesses ,
opportunities and threats, which are related to proper business competition.
Therefore SWOT analysis for the respective business is described as follows-
Strengths- Strengths describes the area towards which the organisation excels and
therefore differentiates itself from its competitors. Therefore major strengths for the Marks and
Spencer are its strong brand image, its loyal customer base and the strong balance sheet.
Moreover company has a high recognition of the brand and offers wide variety of products, in
addition to this there are large number of stores and outlets in the world which increases the
productivity and profitability of the business. This makes it different from its competitors such as
John Lewis, as because of the variety of stores of M&S all over the world it helps them to attract
large number of customers and therefore enhances brand image in the global market. In addition
to this respective company has a wide range of brands which helps in meeting the varied
requirements of the different customers (Micheli and Mura, 2017). This is the major strength of
the company over its competitors and moreover helps them to gain competitive advantage over
its rival companies. This factor helps the respective company to take proper actions and decision
and therefore frames effective strategy which helps them to sustain in the global market for a
effectively long time period. In addition to this, there is diversity of workforce within the
5

respective company and therefore has employees from all the regions, genders and from different
cultural backgrounds.
Therefore , assist the employees to work effectively by mutually cooperating with other
employees. This would help the company to increase its profitability level and creates
harmonious work place environment at the work place. This strength of the company would
assist them to open more of its stores all around the globe and therefore leads the company to aid
competitive benefit to the firm and thereby meet the needs and wants of the customer in a proper
manner. This factor helps the managers within the respective company to analyse the strengths
which the company can better make use of it and excels in the competitive business environment.
It can be analysed that this factor plays important role in framing and implementing strategies in
a proper manner and survive effectively in a global business environment (Obeidat and et.al.,
2017).
Weaknesses- These are the distracting factors or the negative aspects of the business that
makes difficult for the business organisation to properly gain the competitive advantage and
work in a effective manner. Moreover it refers to the area where the business organisation needs
to make improvement. Marks and Spencer has the bad publicity in the global market, moreover
it faces difficulty to penetrate successfully in the global markets. Company has a strong presence
in Europe, United Kingdom and United States. Moreover with difference in demand of the
customers in various countries it becomes the weakness of the company to provide different
products to the customer as per their requirements according to the culture of various countries.
In addition to this supply chain scalability is one of the major weakness of the Marks and
Spencer that is facing so as to deliver maximum products to the customer. In order to resolve this
issue, respective company has started offering global access of their products with the help of
their online store but is facing issue so as to deliver the locations globally. Further more, Marks
and Spencer has a failure regarding using the old techniques rather than adopting the new and
advanced techniques, Adopting the old technique will lead the company to bear heavy cost as
well as takes extra time so as to perform the manual work. Therefore it is recommended to the
management of Marks and Spencer to adopt to the new techniques and performs the work in a
effective and efficient manner (Rahimnia and Kargozar, 2016). Adopting necessary changes so
as to overcome the weakness it will allow the business to sustain in the competitive market for a
effectively time period. This factor is another essential component of SWOT analysis which will
6

influence the decision making of the managers so as to take effective decisions so as to overcome
the weakness in effective manner and globalise their business activities in a way that attracts
larger number of customers towards enhancing the profit margins of the company.
Opportunities- These are the external positive factors which are the opportunities for the
business organisation to grab and succeed in the market place in a effective manner. Moreover it
also allows the company to gain competitive advantage as well as optimize higher returns on
investment. Marks and Spencer has the opportunity of opening stores through out the globe so as
to target large number of customers. This will allow the respective company to enhance its brand
image globally in comparison to its competitor that is John Lewis. Respective company also has
a opportunity of conducting the market segmentation in a effective manner that is company
should split the customers in different groups which has the similar level of interest so that their
needs could be fulfilled in a proper manner. Adopting this technique will help the management at
Marks and Spencer to open more and different branches throughout the globe and to capture
larger market share and beat its competitor of John Lewis and survive in the international market
in a better manner (Shaukat, Qiu and Trojanowski, 2016).
This element of SWOT analysis plays a vital role as it helps determining the
opportunities which is available in the market place, this becomes the responsibility of the
manager within the respective company to frame and implement proper strategies regarding
grabbing the available opportunities and therefore continuing its business operations in an
effective manner. Grabbing these opportunities will allow the company to gain competitive
advantage and get benefited by attracting larger customer share. This factor is important within
the SWOT analysis as it helps the management to make modifications in the actions and
decisions and forms effective strategy to provide products to the customers and beats the
competitive rivalry of John Lewis in a effective manner.
Threats - The anything which can damage the product ,organisation and project are the
threat for the company. So company implement certain effective strategies to prevent such kind
of activities which can harm the organisation. Threats are present in the external environment
and it effects the company negatively. So company needs to take appropriate action to reduce the
effect of such threats present in the environment. It includes various threats such as competitors,
new rules, inflation in the market and there are also various internal threats such as shortage of
skilled manpower. Marks and Spencer facing various threats like laws relating to the liability are
7

different in different countries and M&S may be opened to several liability right given alteration
in policies in those marketplace. The company also faces various laws which varies according to
the country such as continuous changing standards of product which is one of the great threat for
the organisation so M&S must need to protect the company from such kind of threats by taking
corrective actions (Stafford and Taylor, 2016). As company operates business in various
countries and continuous fluctuations in its currency present a threat for the mark and Spencer
because company is not able to perform smoothly in such kind of environment. Raising tends
and local distributor strength also show a threat for the company from which M&S needs to
prevent. Availability of large numbers of competitors also very harmful for the organisational
growth in the marketplace. Competitors of mark and Spencer are united colors of benetton, Zara,
John lewis, Tommy high-flier and many others which effect the productivity and performance of
the organisation at large level. So the manager of the company formulate effective strategies and
implement them properly to reduce the impact of such type of threats and continuous survive in
the complex market.
SWOT analysis is very helpful to identify different threats which harmful for the
organisation. There are also few more threats which are facing by the mark and Spencer is
rapidly changing taste and preference of the customers according to the trends in the marketplace
people are now demanding more fashionable products according to the recent trends of the
market. So it will become very difficult for the mark and Spencer to survive in such kind of
environment against their strong competitors like John lewis and many others. To overcome or
reduce such kind of threats it will become necessary for the company to open its stores in all over
the world which increases the M&S productivity as well as brand image (Terjesen, Hessels and
Li, 2016).
CONCLUSION
From the above report it has been concluded that external factors within the business
environment has a great influence on the performance as well as growth and success of the
company. It is necessary for the management to analyse the effects of external factors and
therefore frames effective strategy so as to survive in this competitive world. Therefore PESTLE
analysis is the effective tool which is adopted by the company so as to analyse the influence of
the external factors on the formulation as well as implementation of strategy. Moreover SWOT
8

Analysis should be undertaken so as analyse the opportunities and threats which are associated
with the company and relates to formulating strategies in the effective manner.
REFERENCES
Books and Journals
Bang, V.V., Joshi, S.L. and Singh, M.C., 2016. Marketing strategy in emerging markets: a
conceptual framework. Journal of Strategic Marketing. 24(2). pp.104-117.
Castelló, I., Etter, M. and Årup Nielsen, F., 2016. Strategies of legitimacy through social media:
The networked strategy. Journal of Management Studies. 53(3). pp.402-432.
Ghemawat, P., 2016. Evolving ideas about business strategy. Business History Review. 90(4).
pp.727-749.
Habib, A. and Hasan, M.M., 2017. Business strategy, overvalued equities, and stock price crash
risk. Research in International Business and Finance. 39. pp.389-405.
Jarzabkowski and et.al., 2016. On the risk of studying practices in isolation: Linking what, who,
and how in strategy research. Strategic Organization. 14(3). pp.248-259.
Kourula, A., Pisani, N. and Kolk, A., 2017. Corporate sustainability and inclusive development:
highlights from international business and management research. Current opinion in
environmental sustainability. 24. pp.14-18.
Luo, Y. and Bu, J., 2018. Contextualizing international strategy by emerging market firms: A
composition-based approach. Journal of World Business. 53(3). pp.337-355.
Micheli, P. and Mura, M., 2017. Executing strategy through comprehensive performance
measurement systems. International Journal of Operations & Production Management.
37(4). pp.423-443.
Obeidat and et.al., 2017. Factors affecting strategy implementation: A case study of
pharmaceutical companies in the Middle East. Review of International Business and
Strategy. 27(3). pp.386-408.
Rahimnia, F. and Kargozar, N., 2016. Objectives priority in university strategy map for resource
allocation. Benchmarking: An International Journal. 23(2). pp.371-387.
Shaukat, A., Qiu, Y. and Trojanowski, G., 2016. Board attributes, corporate social responsibility
strategy, and corporate environmental and social performance.nJournal of Business
Ethics. 135(3). pp.569-585.
Stafford, S. and Taylor, J., 2016. Transnational education as an internationalisation strategy:
meeting the institutional management challenges. Journal of higher education policy
and management. 38(6). pp.625-636.
Terjesen, S., Hessels, J. and Li, D., 2016. Comparative international entrepreneurship: A review
and research agenda. Journal of Management. 42(1). pp.299-344.
9

Vij, S. and Bedi, H.S., 2016. Are subjective business performance measures justified?.
International Journal of Productivity and Performance Management. 65(5). pp.603-
621.
Wu, C.W., 2016. The international marketing strategy modeling of leisure farm. Journal of
Business Research. 69(4). pp.1345-1350.
10