Unit 42: Planning for Growth Analysis and Business Plan for M&S

This report provides a comprehensive analysis of Marks & Spencer's (M&S) growth strategies. It begins by assessing key concerns for evaluating and justifying growth opportunities, focusing on M&S's competitive advantages and the application of Porter's Generic Strategies, particularly cost leadership and differentiation. The report then delves into Ansoff's Growth Vector Matrix, examining market penetration, product development, market development, and market diversification strategies, along with their associated risks. Furthermore, it explores potential sources of funding for M&S, weighing the pros and cons of each option. A sample business plan is designed, incorporating financial information and tactical objectives. Finally, the report elaborates on outlet and progression options for small businesses, discussing their benefits and limitations, and concludes with a discussion of collaboration strategies like strategic alliances and mergers & acquisitions. The report aims to provide a detailed overview of M&S's growth prospects and strategic planning.

Unit – 42
Planning
For
Growth

Table of Contents
INTRODUCTION.....................................................................................................................................3
TASK – ONE............................................................................................................................................3
P1. Assess the main concern for evaluating and justifying growth opportunity of business.............3
P2. Explain Ansoff’s Growth Vector matrix with assessment in expansion of opportunities.............5
TASK – TWO...........................................................................................................................................7
P3.Demonstrate potential sources of funding with pros and cons....................................................7
TASK – THREE.........................................................................................................................................9
P4. Design business plan with monetary information and tactical object.........................................9
TASK – FOUR........................................................................................................................................11
P5. Elaborate the outlet or progression options of small business with benefits and limitations. . .11
CONCLUSION.......................................................................................................................................13
REFERENCES.........................................................................................................................................14

INTRODUCTION
The planning is most essential role for Board of Directors within the organisation for
implementing their strategies to attain victory through competitive advantages. This process results in
generating expansion, development and stability of business administration that create opportunities
to achieve ambition (Basma and Savage, 2018). In this project, the small and medium enterprise
selected is Marks and Spencer (M&S) that is mostly known for selling clothes, home and food
products. This assignment assesses main concerns for evaluation and justifying growth opportunity of
business. It further demonstrates the potential sources of funding with pros and cons. Additionally, it
designs business plan by means of monetary information and tactical object. This project also
elaborates outlet and progression options of small business with benefits and limitations.
TASK – ONE
P1. Assess the main concern for evaluating and justifying growth opportunity of
business
Marks and Spencer (M&S):- This organisation is considered as British multinational retail
company that has been headquartered at London, England, United Kingdom. It is most popularly
known for selling cloths, home and food products that enlarge customer which result in wealth
maximisation. The ISIN number is GB0031274896 which was established on Leeds at 1884 as well as
founded by Michael Marks and Thomas Spencer. It majorly consists of 1,463 numbers of employees
for distributing its services worldwide at 2019. The Chairperson is Archie Norman and CEO is Steve
Rowe with its diversified brands that are Per Una Autograph Limited, Blue Harbour, M&S Collection
and Energy (Colantoni and et.al., 2018).
Competitive Advantage of (M&S):- The Marks and Spencer develop aggressive strategies
through technological factor by adopting various equipments within the organisation. This leads to
manufacture products and services at least expenditure with quality and time management. The
Company is highly capable in selling its superior production at low cost that attracts large number of
clients and results in high sales volume. This creates opportunity for organisation to compete with
opponents such as Next, Burton, Debenhams, etc., for being stable at its position within the
international marketplace.
Porter Generic Strategy for (M&S):- This strategy being is described as tool being applied
by managers in an organisation for various tactics that result in growth and development. It is mostly
executed by managers of Marks and Spencer for analysing variety of plans and schemes that are
beneficial in minimising the high quality production cost (Michael Porter Generic Strategy. 2015).

This result in gaining customer benefit through encouraging them to purchase products within
short duration as varied schemes is applicable for short duration.
 The Cost Leadership:- It refers as restricting the expenditure on products through
developing strategies which are beneficial in promoting and targeting and large number of
customers at broad level with low expense. The Marks and Spencer managers are highly
beneficial in growth and development of company through incremental sales with least-cost
that leads to generate high income earnings (Finnegan, MacNearney and Pigeon, 2018).
Option for growth-
By reducing the overall costs the company can make sure that it is able to follow this strategy
effectively. Thus in this way Marks and Spencer will be able to implement this strategy without
problems and issues.
 The Differentiation:- This is described as producing more products within the organisation
at highly specialised quality and services that have the capability to meet the needs and wants
of customers. Managers of Marks and Spencer can use this strategy by adopting innovative
ideas that leads to manufacture new product or modify some changes in commodity.
Option for growth-
By making the products different from that of the competitors Marks and Spencer can make sure that
it is able to differentiate the products effectively and efficiently without problems and issues. Thus
this strategy can be followed if the company can achieve its distinctiveness in its products and
services.
 The Cost Focus:- The ability of directors that are highly focused on minimising the pricing
strategy with the motive to maximise revenue and profitability ratios. The Marks and Spencer

managers can use this strategy for restricting the cost of products to increase sales of
segmented target market.
Option for growth-
Marks and Spencer can make its focus on the particular segments where the right strategies can be
used for the purpose of reduction of the costs. By doing this the company can achieve its goals and
objectives easily.
 The Differentiation Focus:- It refers as the main consideration of executives for segmenting
their whole target market into small group of individuals which further aims to develop
differentiated product with high quality that have the power to satisfy customers. Managers of
Marks and Spencer focus on adopting various strategies which results in meeting
requirements of end-users through delivering superior products that increase their support and
loyalty (Giersch, 2019).
Option for growth-
Marks and Spencer can make use of this strategy by making sure that it is able to differentiate
products effectively in specific areas. In this way it will be able to achieve growth.
Evaluation of generic strategy:- From the Porter Generic Strategy it is evaluated that all the
approaches being discussed creates opportunity for growth and development of company. It also
maximise competitive advantages that result in competing with rivalries for being sustainable at
global marketplace. From the above stated four strategy, adoption of cost leadership is most suitable
and viable for Marks and Spencer as led to more effective costing of product and also lead to
enhancement in profit margin along with attracting larger numbers of customers for its more
affordable products.
Justification of generic strategy:- The justification of Porter Generic Strategy for
managers of Marks and Spencer majorly adopts cost leadership that results in expansion and
competing with opponents through their aggressive strategies. It is beneficial for company to attaining
their goals and objectives at certain duration which result in achievement of success (Goodspeed and
Hackel, 2019).
P2. Explain Ansoff’s Growth Vector matrix with assessment in expansion of
opportunities
Ansoff’s Growth Vector Matrix:- The approach is strategic planning technique which is
essential for managing and running business administration with inventive ideas that result in building

competitive advantages through intrinsic and extrinsic capabilities (Ansoff Growth Vector Matrix.
2020).
The managers of Marks and Spencer further implements this strategy for taking varied
decisions that leads company to sustain at competitive market. It is most important for an organisation
to analyse their market or product expansion grid with the motive to generate success for competing
with rivalries.
 Market Penetration:- The process for minimising price of commodities and services for
short period in order to encourage customers in maximisation of revenue and profitability
ratios. Managers of Marks and Spencer further use different strategies such as least-cost price,
high quality with time management. It creates opportunity for company to sustain at global
market with their increasing competitive advantages which is difficult for rivalries to compete
(Guay and Waaub, 2019).
Risk- The risk in this strategy is that if the managers of Marks and Spencer are not able to penetrate
the market with the right products and services then other companies can gain edge easily in the
market.
 Product Development:- It is the ability of managers for developing alteration in their
existing products in accordance with changing taste and preferences of customers. The
managers of Marks and Spencer further takes necessary steps in modifying their products
with the motive to satisfy needs and wants of customers in achieving success. It plays major
role in attracting customers with various alterations performed for satisfying their needs at
low cost.
Risk- The risk in this strategy is that if the new product developed by the company in the market does
not meets the expectations of the customers then this can create a problematic situation for the
companies.
 Market Development:- The process through which directors aims to expand their business at
large level by franchising and licensing its brand at various locality that increase it awareness

and positioning among customers. Managers of Marks and Spencer further aims to promote
their existing products to different boundaries of nation that leads to expand business. It
creates opportunity for growth and development at large level for increasing sales and profits.
Risk- If Marks and Spencer choose a wrong area for their business expansion then the demand of
their products and services can be worst hit and this can lead to creation of problems and issues.
 Market Diversification:- The managers of an organisation emphasize on market
diversification through manufacturing differentiated and diversified products which has the
capability to attract whole target market. This results in new product development with
expansion of business at broad category. The managers of Marks and Spencer highly focus on
this strategy as to compete with rivalries through aggressive strategies that leads to remain
stable at international market (Liang, Mays and Hwang, 2018).
Risk- The risk in this strategy is that if wrong diversification is made by Marks and Spencer in a
wrong area then it can create huge losses for the company.
Evaluation:- The Ansoff’s Growth Vector strategy evaluates that Board of Directors highly
emphasize on these tactics in order to be successful with accomplishment of goals and objective
effectively through proper management of workforce. It highly focuses on developing good employee
relations that leads to collaborate with each other for accomplishing the target at certain period.
Managers of Marks and Spencer aim to utilise these strategies in building their competitive advantage
by developing new product or expanding business.
Justification:- From the above mentioned Ansoff Growth Vector strategy, managers of
Marks and Spencer adopts market penetration strategy that emphasize managers to minimise cost
for enlarging customers. This results in growth of sales volume and tends to generate profit-margin by
increasing their clients through attracting them with high quality at low cost.
Definition of Collaboration:- The collaboration refers as collective agreement between two
or more companies for performing their business activities for generating high profit-margin that
leads company to attain success. This strategy of organisation describes ability of managers to
challenge rivalries for being stable at large duration. Managers of Marks and Spencer further aims to
utilise these strategies in developing strategic alliance, merger and acquisition for creating good image
and reputation among its target (Pascual, Pukkala and De-Miguel, 2018).
 Strategic Alliance:- It is the process through which two or more companies collaborates with
each other for accomplishing specific target in short duration and perform its actions in
collective agreement. Managers of Marks and Spencer can use this strategy for increasing
competitive advantage to overcome controllable and uncontrollable risk. This is beneficial for

analysing the strategy of each other and effective utilisation of scarce resources for being
stable at competitive market. It faces drawbacks as companies are not able to manage their
workforce effectively which lacks in goal accomplishment.
 Merger and Acquisition:- The merger is termed as collaboration of two companies for
performing their business activities collectively. The acquisition refers as one large
organisation acquires small business for transforming its loss into profits. The managers of
Marks and Spencer generate benefits through developing good employee relations among
workforce that leads to perform task with perfection for achieving certain specified goal. It
also face drawbacks when people are not well organised and lack in understanding beliefs of
each other that result in delay for success (Pezzagno, Richiedei and Tira, 2020).
TASK – TWO
P3.Demonstrate potential sources of funding with pros and cons
Cost of investment decision:- The ability of mangers for taking decisions in investing money
to different place or location that result in expansion of organisation through developing varied
branches, franchising and licensing. Managers of Marks and Spencer implement this investment
technique for increasing brand awareness and positioning among its target market with the motive to
maximise revenue. It is further explained as under:-
 Pay-Back Period (PBP):- The Pay-Back Period is termed as time consumption for
transforming the cost of investment into capital generation that leads company to maximise
profit-margins. Managers of Marks and Spencer emphasize on taking strategic decision-
making procedure that creates opportunity for company to minimise risk by gaining
competitive strategies that leads to utilise scarce resources effectively.
 Net Present Value (NPV):- The Net Present Value is described as the difference between
expenditure made on purchasing specific assets which leads to generate income in future
earnings (Prina and et.al., 2019). The managers of Marks and Spencer implement this for
analysing the best alternative among various assets which will leads to generate higher
earnings as compared to loss.
There are two different types of potential sources which are useful in funding as:-
Intrinsic Source:- It refers as the funding which mostly takes place within the organisation for
effective utilisation of scarce resources.

Funding from Personal Saving:- The managers of organisation aims to invest their money
from taking a proportionate amount from their personal saving in order to achieve goals and
objectives efficiently.
 Pros:- The managers of Marks and Spencer are highly profitable in this situation as there is
no possibility for facing loss and lacks in paying interest as being doing investment from
personal income which restricts liability.
 Cons:- Managers of Marks and Spencer are unprofitable as they lacks in proper management
of monetary terms in both business which leads to generate loss (Rathus and Nevid, 2019).
Use of this option- Marks and Spencer can make use of this option so that their managers are able to
use personal savings effectively for investment in the business. This is a risk-free option for the
company.
Peers funding:- The entrepreneurs further aims to convince their family members and peer
for investing within their business expansion in order to restrict loans and proving them amount on
certain futuristic date.
 Pros:- The managers of Marks and Spencer are beneficial with this funding as relative are
agree with this investment with less expectation of return and interest payment.
 Cons:- Marks and Spencer managers are unbeneficial as it spoils the family relationships with
increasing disputes that results in high conflicts.
Use of this option- Managers of Marks and Spencer can make sure that they are able to use peers
funding for getting the right amount of funds at a comparatively lower interest rate than others.
Extrinsic Source:- This refers as funding which mostly takes place from outside the organisation in
order to minimise threats through maximising opportunities for generating aggressive strategies .
Business Incubators:- The business incubators is described as supportive organisation which
used to provide help for small and start-up enterprise in being stable at competitive market through
providing them funds and management training.
 Pros:- The managers of Marks and Spencer are advantageous with these business incubators
through gaining potential source of funding and realising techniques to deal with varied
situation within the organisation.
 Cons:- Managers of Marks and Spencer are disadvantageous as some organisation used leak
confidential strategies of business to its competitors that increase high threats for company to
be sustainable at global market.

Use of this option- Managers of Marks and Spencer can make sure that they can use this option and
get the funds they desire for their growth. With this option they can get higher amount of funds
without problems and issues.
Loan from Banks:- It refers to borrow money from bank at the time when required and is
liable to pay principal with interest at certain futuristic date.
 Pros:- The managers of Marks and Spencer are helpful in saving money at low interest rates
which leads them to capital generation (Schreiner and Madlener, 2019).
 Cons:- Managers of Marks and Spencer are unhelpful as increasing rate of interest leads them
to pay principal with high amount of interest that restrict in generating more asset valuation.
Use of this option- Managers of Marks and Spencer can make use of this option so that they are able
to get the required funds from the Bank at a reasonable interest rate.
Evaluation:- From the prescribed potential sources of funding, managers of Marks and
Spencer usually adopts funding from personal savings as it is beneficial for company to effective
management of company without paying interest and restrict from family disputes. This further result
in full utilisation of scarce resources by improving product quality that leads to incremental sales.
TASK – THREE
P4. Design business plan with monetary information and tactical object
Business Plan:- The business plan is termed as estimated production and sales being
generated by an organisation as per the actual performance of company in order to achieve desired
targets. It is most essential for an organisation to manage expenditure for restricting the cost of best
quality products and service (Seiti and Hafezalkotob, 2019). The managers of Marks and Spencer
implement this business plan for analysing their cost accounting system at varied level which results
in high price of product that affects revenue and income earnings of organisation.
The business plan has been developed with the inclusion of monetary information and
tactical object as shown below:-
Considerations of Business Plan Clarification
Executive Summary This project is based upon small and medium enterprise which is
selected as Marks and Spencer (M&S) that is mostly known for
selling clothes, home and food products. The assignment further
elaborates Porter Generic Strategy and Ansoff’s Growth Vector
Matrix for analysing the competitive strategies of organisation to
be sustainable at international marketplace. It also examines the
potential sources of funding with its pros and cons as well as
develops business plan for identifying its current position. This

further elucidates the exit and succession option for small
business that develops benefits and limitation for
accomplishment of success.
Vision The vision of Marks and Spencer is to build core advantage
through improving its quality and services of products with
development of innovative ideas that increase customers trust and
faith (Shahab, Clinch and O’Neill, 2018).
Mission The mission of Marks and Spencer is to inspire quality which
creates differentiation from its rivalries and leads to provide high
satisfaction for its customers to increase growth for being
sustainable at competitive market.
Goals and Objectives The managers of Marks and Spencer focus on generating goals
through adopting effective leadership style in improving their
quality of cloths and food speciality for increasing sales and
profits.
 To enhance sales by 15% in coming 6 months.
 To improve overall productivity and profit by 10% in
next 9 months.
Organisational Structure The organisational structure being adopted by managers of Marks
and Spencer is flat structure as its being the systematic or
disciplined process which leads workers to perform their certain
specific task within time boundation for achieving success.
Marketing strategy The strategy being adopted by managers of Marks and Spencer is
social or digital marketing that leads organisation to increase
sales through promoting brands at broad level for attracting large
number of customers (Taha and Rodríguez-Vega, 2020).
Increasing Opportunities The managers of Marks and Spencer aims to increase
opportunities through following business environmental factors
that are explained through PEST analysis as:-
 Political:- The managers of Marks and Spencer are
favourably affected with political factor as the
government of United Kingdom used to remain stable
which leads company to follow its continuous procedure
for target achievement.
 Economical:- Marks and Spencer managers are
positively impacted with economic factor as it attracts
large number of customers through decreasing its pricing
strategy at very low or cheap cost at inflation which
enrich the satisfaction level of end-users to consume
more of its products.
 Social:- The managers of Marks and Spencer are
favourably affected as it develops customers relationship
management which results in analysing the changing
demands of customers that has to be fulfilled easily with
some modifications in products and services.
 Technological:- Marks and Spencer managers are
positively impacted with the adoption of new technology
that leads to restrict labour cost and improve quality and
perfection which satisfies customers at high level.
Value and Ethics The managers of Marks and Spencer follow its ethical values
through promoting its products and services with trust and faith
by restricting misrepresentation. It is further aware of consumer
protection rights and also emphasizes on needs of workers
through supplying them salary which provides them two time

meal a day and lead to survive in shelter as their welfare. The
Company generates value through being trustworthy for its
clients and satisfying their needs.
Expectations of Stakeholders The stakeholders of an organisation are described as directors,
employees, customers, suppliers, government, etc., which
perform their actions in the business to compete with rivalries
through being sustain at international marketplace. The
expectation of these stakeholders is to gain personal and
organisational goals for meeting their requirements.
Potential Customers The managers of Marks and Spencer used to focus on their
potential customers by segregating them into different groups
which are categorised as:-
 Market Segmentation:- The managers of Marks and
Spencer aims to segment their target market by
discriminating them in accordance to geographical areas
that includes custom, ethics, values, culture, location, etc.
 Market Targeting:- Marks and Spencer managers aims
to target their customers for analysing their needs and
wants that has to be filled with effective production by
improving their quality.
 Market Positioning:- The managers of Marks and
Spencer further focus on positioning its product at broad
level through adoption of digital marketing which tends
to increase sales and profits through encouraging rural
and urban areas.
Funding Sources The Marks and Spencer managers further aims to fund from
through personal savings and retained earnings with
restricting interest payment and lacks in family disputes. It is
essential for managers to fund as to expand their business with
increasing brand positioning for its customers to enlarge sales.
Expected Budget The managers of Marks and Spencer highly focus on their
estimated budget by forecasting their strategies in order to
achieve success. These are as follows:-
 Promotional Mix:- The Marks and Spencer managers
aims to promote its products and services at large level
with adopting promotional mix of online media that leads
in extra usage of Facebook, Instagram, Google, etc., for
providing services towards clients at 24/7 servicing
strategy.
 Cost Leadership:- The managers of Marks and Spencer
focus on minimising the cost of their products for
delivering superior services in order to increase sales and
profit-margins (Trentanovi and et.al., 2018).
Financial Information Following budget are prepared by Marks and Spencer to achieve
its target of enhanced performance and better business success.