M&S Global Operations & Logistics: Achieving Competitive Edge

This report provides a detailed analysis of Marks and Spencer's (M&S) global operations and logistics strategies, focusing on how the company achieves a competitive advantage through effective supply chain management. It begins by outlining the global supply chain network of M&S, emphasizing its relationships with over 400 suppliers across 44 countries and its commitment to fair practices and sustainability. The report then discusses the rationale behind M&S's facility locations and the supply chain strategies it employs, including responsive supply chains. Furthermore, it examines how M&S leverages logistics management to enhance customer service, reduce costs, and ensure efficient product delivery. The report concludes with recommendations for M&S to sustain its competitive position in the future, highlighting the importance of data sharing, accurate forecasting, agility, and cost minimization within the supply chain network. This analysis showcases M&S's strategic approach to logistics as a key driver of its success in the global market.

The Global Operations & Logistics Research on Mark and Spencer, UK

Running Head: Report
Executive Summary
In today’s globalized market, organizations are paying more attention towards delivering
additional value to the consumers. The emphasis on consideration of organizations is giving
products and administrations that are increasingly profitable contrasted with its competitors.
This powers supply chain network to be progressively responsive and achieve competitive
advantage. The phenomenon of competitive advantage is witnessed to be discussed very deeply
in organizational strategies. Modernized management approach locates the logistics on the
strategic level rather than placing it on simple support activity position in order to gain and
sustain a competitive position in the market. Logistics management has a huge contribution in
achieving competitive advantage; especially when the customer service and low-cost factors are
combined together. Effective logistics aims to meet the consumer's requirement at the
affordable prices along with facilitating the flow of information, funds and production material
amid the supply chain partners of the organization. From this point of view, logistics
management can place the organization ahead of all its core competitors by ensuring adequate
and efficient services like delivering the products to the customers as and when required at the
right time.
The report discusses the role of effective logistics management in achieving the competitive
advantage of the organization named “Marks and Spencers” that operates in a global supply
chain network. Such giant retailers like M&S need to focus on the procurement of material,
transportation, inventory, information & facility management, customer service while the
implementation of their strategic planning with the main objective of enhancing the efficiency
in all manner to accomplish competitive advantage. Right management of these components
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will leave no stone unturned for M&S to gain an advantageous position. Sharing real-time data
and information, much accurate forecast, agility and minimized cost in the supply chain network
can be accomplished by logistics-oriented strategy. The entire report is divided into four major
components. The first component discusses the global supply chain network of the selected
organization. The second component describes the rationale for M&S's facility location;
followed by the third component which presents how M&S have gained competitive advantage
via its impressive logistics management. The last component narrates the main discussions of
the report and also highlights some recommendations for Marks and Spencer to sustain its
position in future.
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Contents
Executive Summary.........................................................................................................................1
Introduction......................................................................................................................................4
Inbound Logistics.........................................................................................................................4
Outbound Logistics......................................................................................................................5
Overview of M&S...........................................................................................................................6
The global supply chain network of M&S......................................................................................7
Supply chain & Logistics.............................................................................................................9
Supply chain strategies followed by M&S................................................................................10
The rationale for facility location..................................................................................................13
Competitiveness achieved.............................................................................................................15
Conclusion & Recommendation....................................................................................................20
Recommendations......................................................................................................................21
References......................................................................................................................................22
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Introduction
The supply chain is a dynamic process which incorporates the continuous flow of information,
funds and items amid different stages. A supply chain network consists of different components
which collectively work together to facilitate the continuous flow or moment of the products.
This network starts with the customers, which means that it gets initiated as soon as the customer
places an order to the company and it gets terminated until the order for the customer is
successfully completed. The market has emerged out to be very demanding and uncertain in
recent years, so it demands that organizations should be very flexible in terms of logistics
management and supply chain activities if they really want to achieve competitive advantage
(Svosve, 2018).
Logistics management includes the processes like planning, implementation, monitoring and
controlling of the adequate flow of material, final goods, spreading of information from
originating point till the desired end with the target of achieving customer satisfaction at utmost
priority. Logistics activities are majorly classified in two broad categories.
Inbound Logistics
This category of logistics is related to the smooth and financial savvy inflow of raw materials
and other pertinent input required from the suppliers to the production plant necessary for the
manufacturing process. Organizational management has to maintain cordial relationships and
regular interface with all the associated suppliers for the adequate management of this type of
logistics activity (Sai, 2018).
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Outbound Logistics
This category of logistics is also known as supply chain management which incorporates
moment of finished goods from manufacturing plant to the customer end. For the appropriate
administration of outbound logistics, the administration needs to keep up a persistent interface
with transport administrators and channels of dispersion (Li, 2014).
Figure 1: Categorization of Logistics activities (Sai, 2018)
The main objective of each supply chain activity should be to maximise the total value
generated. This project report aims to determine the M&S’s accomplishment of competitive
advantage among its competitors through its appropriate effective logistics management. The
main objective of the assignment is to study and analyse how does M&S manage its logistics
activities. The secondary objectives are to search the information pertaining to the supply chain
of M&S, to discuss the supply chain management strategies, to interpret them
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(SCM) supply chain management process, to describe the facility location of M&S and to
measure the performance and efficiency of the company through logistics activities.
Overview of M&S
M&S (Marks and Spencer) is the largest UK retailer which offers fashionable clothes,
accessories, award-winning food products and unique stylish homeware. It is currently operating
in more than 57 countries from 1465 stores. This company was established way back to 125
years and is equipped with core values like quality, service, innovation and integrity. The annual
turnover of this company is £8.4bn and it has categorised its business in two segments that is
clothing and homeware falls under general merchandise and another segment is food. Customers
can purchase their preferable range of products through their online portal, physical stores and
through phones. The company aims to deliver consistent service to all its customers equally.
Every year the company is expanding globally and is trying to grab the market share in
menswear and kids section. It has made a five-year plan named "Plan A" under which the
company is trying to sell environmental friendly products (Marks and Spencer plc, 2019).
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The global supply chain network of M&S
Being such a prestigious brand M&S is aware of its responsibilities towards suppliers, customers
and other stakeholders. For this, the company pays off fair prices to its suppliers and it also
ensures that every individual is involved in the supply chain network should be provided with a
good working environment. M&S is a food specialist and does not own any farms or
manufacturing locations. The company has built a reputation for offering high quality,
innovation and environmentally friendly or sustainability just by maintaining healthy and long-
haul relation with its suppliers. The food supply chain network of M&S is quite complex as they
are in tie-up with more than 400 suppliers across the globe that produce the products for M&S at
different locations across 44 countries. Most of the supplier's locations are in Europe. The
company deals with rules of 70 countries to purchase its raw materials and commodities. Further,
the suppliers of M&S sources raw materials from different farms. Moreover, the nature of
M&S's portfolio implies that production quantity is not constantly steady, particularly inside
farming, where enormous varieties – both unsurprising and erratic – are driven via regularity and
varieties in a client request (Marks and Spencer plc, 2019).
M&S have designed an interactive map which clearly depicts the location of food and household
products made by the company, thereby highlighting the profiles of different factory location
sites utilized by its suppliers. This UK retailer sources only from those suppliers who fulfil the
criteria and meet the standards framed by it. Against this setting, M&S gives priority building up
a supply base that suits and can align with the company in near future, used and proficient, which
drives inventive items, benefit and enables everybody to reinvest. M&S have set out on various
activities to rebuild their supply with the target of improving their productivity and edges without
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bargaining product quality. It has likewise reinvested this cash in cost and quality and imparted it
to suppliers to enable them to make further efficiencies. The company has complied with a
different code of Practices, acts, Licensing etc to meet the standards set for supply chain
network. The table below describes the compliance of M&S
S.N
O
Compliance to Category Remarks
1. UK Groceries Supply Code
of Practice
Code of Practice To comply with
fair deal with
suppliers
2. Gangmasters Licensing
Authority
Licence To avoid worker
exploitation
3. Supplier Retail Protocol. Protocol To avoid worker
exploitation
4. UK’s Modern Slavery Act Act To respect
human rights
5. Technical terms of Trade Terms &
conditions
To meet the
minimum
required
technical
requirement
Figure 1: Table describing the compliance of M&S for its suppliers (Marks and Spencer plc,
2019)
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The Technical terms of trade followed by M&S are supported by certain policies such as
packaging, Non-GM, etc; codes of Practice and specific guidelines. The suppliers of M&S are
directed to access them through Quality Management System available online. The company
keeps on conducting audits of their associated suppliers to assure food safety and product
integrity.
Supply chain & Logistics
Supply chain vision of M&S
“The supply chain of M&S will involve new facilities and the policies will target to improve the
visibility and product movement through the fast and upgraded system to further increase the
agility"
The supply chain has been modified since the past few years starting from the sourcing to the
procurement strategy. Before the year 2000, M&S used to source 90 % of its manufactured
products in two regions (Europe & North Africa). Till the year 2012, it only sourced 11 % from
these regions and rest from the other locations such as Indian sub-continent & Far East. Earlier
the company was associated with the full-service vendors but now it is shifting to a FOB regime.
This has enhanced supply chain visibility and has also reduced complexity. The segmentation of
the supply chain has become easy through the Regime. 60% of the product is seasonal and 30%
fall under the core category of product mix. Rest 10% comes under Fast track & trials segment.
The criticality lies in the short lead time ranging from designing till the final product. A new set
of logistics centres have been developed in the UK as a part of new supply chain strategy in
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order to replace the network of 110 different sites from where the company has distributed its
merchandise to all outlets in past (Akabo Media, 2013).
M&S has recently enhanced its global supply chain network by making a partnership with Zetes.
This partnership ensures the collaboration amid M&S and its all food suppliers through the
supply chain platform of Zete i.e ZetesOlympus. This platform is a visible platform which also
connects the company with all its logistics providers along with supply chain collaboration
(Henderson, 2018). ZetesOlympus gives real-time alerts to M&S regarding the availability of
fresh food and it also helps the company to foresee all upcoming disruptions.
Supply chain strategies followed by M&S
M&S offers many products like food, clothing and home products to its customers and side by
side it also deals with a number of suppliers, people and stores. All this requires coordination and
art of logistics and supply chain management. The company is aware of the importance of
delivering products to its customers at the right time, location and in the right manner.
The supply chain strategies of M&S vary according to the type of product. The company
manages its supply chain as per the requirement of the customers and the origin of the products.
The logistic policy of M&S also depends on the origin of the product (Khan, 2018).
The company uses two approaches of supply chain strategy for improving its supply chain
performance which is discussed below:
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Responsive supply chain
This type of approach focuses on managing the supply chain through flexibility. It mainly
stresses on consumer's reaction and onto the high level of service. M&S has placed its inventory
locations very near to the customers to accommodate the sudden changes in the customer's
demand and continuous supply. Authors have claimed in their previous researches as well that
the organizations should make their supply chains in a manner that it should be flexible enough
to harbour adverse conditions or uncertainty in business. This is the demonstration of responsive
flexibility as agility. M&S takes utmost care of the agility notion by regularly focusing on market
demand (Slack, 2011).
Efficient supply chain
This type of approach focuses on managing the supply chain in an effective manner. Efficient
supply chain strategy is to maintain a low level of inventory at all the relevant retail locations.
This approach helps M&S to pay more attention to its manufacturing and interrelated functions
thereby resulting in low-cost inventory. Moreover, the flow of information is faster from the
retailer to the manufacturer. This oversees supply chain network by conveying intense interest
period with adaptable lead time. Examination of the supply chain as a complete process to
discover delays so as to abbreviate throughput time is the reason for Lean supply chain idea
(NCHU, 2015).
Although M&S has made all strict arrangements to manage its supply chain and logistics still
there were some critiques heard about the company in this context. According to Logistics
manager news, M&S was recommended to upgrade its supply chain as the retailer revealed that
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