Comprehensive PESTLE Analysis Report for Marks and Spencer Retail

This report provides a comprehensive PESTLE (Political, Economic, Social, Technological, Legal, and Environmental) analysis of Marks and Spencer (M&S), a major British multinational retailer. It examines the external factors influencing M&S's business operations, including the impact of Brexit, economic fluctuations, changing consumer values, legal regulations, technological advancements, and environmental sustainability initiatives like Plan A. The analysis highlights how these factors affect M&S's strategic positioning, market share, and overall performance, with a focus on the company's efforts to adapt to a dynamic business environment and maintain a competitive advantage. The report concludes by emphasizing the importance of considering the external business environment for effective strategic decision-making. This report is contributed by a student and available on Desklib, a platform offering AI-powered study tools.

Marks and Spencer

M&S
Introduction
Marks and Spencer is the largest British Multinational retailers in London. The organization
maintains its specialty in the clothing products. The company was established in 1884 by
Michael Marks and Thomas Spencer. Headquarter of company is in London, United Kingdom. It
has been observed that company focuses on the Plan A, 2025 in which sustainability plan is
considered that support 1,000 communities and 10 million individuals and they have the aim to
focus on reducing the waste in 2025. In 1884 the company started its business as the penny bazar
in leads. The company exports the best of the Marks and Spencer clothing and home furniture on
the global platform with stores and also they have online presence across Europe, Middle East,
and Asia. In UK, the franchise partners of the company are WHS, MOTO, COMPASS, and SSP
AND BP. The l franchise partners on the international platform are Alhokair Fashion Retail,
Central group, P.T Mitra and reliance retail (Marks and Spencer Plc., 2018).
PESTLE ANALYSIS
 Political factor
It can be analyzed that overall cost of sourcing is minimized due to the EC free trade
agreement. Just due to the high cost structure on international platform, the organization
faces the problem in relation to the market share. The method like fair trade policy
considered by Marks and Spencer has affected just because of the energy efficiency
scheme implemented by the government of UK. It can be examined that issues in context
to labor laws increases for the organization in the highly competitive market. So, Marks
and Spencer also faces the problem in context to the entire cost of sourcing. Also, Brexit
has impacted the overall business functions in the UK as it affected the overall spending
power of the customers (Johnson, Scholes and Whittington, 2008).
 Economic factor
It is stated that retailing sector in context to the factor of economy focuses on the
variations that takes place in context to the interest and tax rates. At the time of
considering the economic slumps then it can be easy for the company to attain growth.
The competitors like Asda emphasizes on transferring the good to the other countries as it
can help in minimizing the entire cost. It can be evaluated that organization has shutdown
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many stores and just because of this reason the overall jobs in the workplace has been
reduced by 2% out of 70,000 employees. In financial crisis of 2008, it has been seen that
the competitors like Aldi and Tesco considered a strategy of discounted pricing. This
strategy reduced the sales and enhanced the customer satisfaction because of the
customer’s preference and desires. In 2015, the strategy assisted the company in
maintaining the large market share and the sales enhanced in many countries like Hong
Kong and India. But crisis in context to finance can be enhanced due to the price which
can impact the customers of the company (Etgar, 2015). There are also various issues
which took place in the last few years like falling in the commodity prices and also pound
fluctuations. It has impacted the sales of the Britain and with the reduced price the impact
has been analyzed on the performance of the company.
 Socio- cultural factor
In context to the socio factors it can be noted that there is a shift in the individual value
with the shift in the generation. If focus is given on the supplying power of Marks and
Spencer, it has been observed that the values of the individual also changes. The
company focuses on maintaining long time relations with the customers so that growth
can be attained in the highly competitive market. Also, the company focused on the social
agenda in which PLAN A, the strategic sustainability plan considered by the company
which enhanced the relation of customers and suppliers (Hannington, 2016).
 Legal factor
It has been observed that legal factor impacted the safety of the customers. Marks and
Spencer also focused on the initiative which can be stated as “Behind the code”. In this, it
provides the company the platform to market the products through Omni Channel. In
2014, Marks and Spencer considered the new reporting regulations in which the
remuneration framework emphasizes on offering transparency to its stakeholders (Lynch
and Smith, 2006).
 Technological factor
It has been observed that Marks and Spencer is in a good strategic position that focuses
on altering the overall media landscape. Predictive analytics system and allocation
replenishment are considered as the big data projects which is considered by the
company. In this the emphasis is on the digital strategy that considers the “Mobile first
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approach” which satisfies the needs of the customers. The company appointed the digital
lab team of 150 in house software engineers who emphasizes on the objective of
considering the innovative approaches in context to the overall activities of the company
(Islam, 2016).
 Environmental or ecological factor
The PLAN A, considered by the company focused on maintaining the overall social
responsibility and reduced waste. In 2015, the M&S goods are sourced from Gold and
Silver sustainability standard producers and also the other initiative considered as
Shwopping has the outcome in context to 10.6 million garments which were donated to
Oxfam. The investment made in the PLAN A, products focused on development of
sustainable products and services in the UK Eco factory. In 2016, M&S maintained its
transparency in the supply chain where the overall sources of M&S emphasize on the
products. With sustainability strategy the company also maintained its competitive
advantage (Laffy and Walters, 2016).
Conclusion
So, it has been concluded that company should focus on the external business
environment so that it can be easy to consider the right strategy which will beneficial for
growth. Pestle analysis is one of the external business environment factors that have
influenced the overall operations of the company. So, it is necessary to consider the factor
before introducing new products in the market.
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M&S
References
Etgar, M., 2015. Global Retail Entrance Strategies. In Proceedings of the 1997 World Marketing
Congress, pp. 266-269. Springer, Cham.
Hannington, T., 2016. How to measure and manage your corporate reputation. Routledge.
Islam, K., 2016. Can Ethical Business Strategy Influence Consumers’ Buying Behavior and
Loyalty: Marks and Spencer PLC?. Case Studies in Business and Management, 3(1), p.38.
Johnson, G., Scholes, K. and Whittington, R., 2008. Exploring corporate strategy: text & cases.
Pearson education.
Laffy, D. and Walters, D., 2016. Managing retail productivity and profitability. Springer.
Lynch, R.L. and Smith, J.R., 2006. Corporate strategy. Harlow,, England: FT/Prentice Hall.
Marks and Spencer Plc., 2018. M&S [Online]. Available at: https://www.marksandspencer.com/
[Accessed on 13 January 2019].
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