Retail Theory and Practice: Challenges and Strategies for M&S

This report offers a comprehensive analysis of retail theory and practice, with a specific focus on the British multinational retailer Marks & Spencer (M&S). It begins with an introduction to retail, defining the process of providing goods and services to consumers and highlighting the role of retailers in understanding market demands. The main body of the report delves into the relevant changes in the macro-environment, including political, economic, social, technological, legal, and environmental factors, and their impact on the fashion retail industry. It then examines the micro-environment, focusing on customers, employees, competitors, media, suppliers, and their influence on business success. Furthermore, the report discusses strategies and tactics that retailers, like M&S, can employ to overcome challenges, such as changes in government policies, shifts in consumer preferences, and economic fluctuations. The report concludes with recommendations for the future and is supported by references to academic literature and industry sources.

RETAIL THEORY AND PRACTICE

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................2
1.1 Relevant changes in macro-environment..............................................................................2
1.2 Relevant changes in micro environment...............................................................................3
1.3 Strategies and tactics that can be used to overcome challenges............................................5
RECOMMENDATIONS.................................................................................................................6
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................8

INTRODUCTION
Retail can be termed as a process of providing or giving goods, products or services to
consumers with the help of multiple channel of distribution in order to earn a huge amount of
profit. Retailers are those persons who is in charge of reselling the goods.These people are not
the manufacturers of product. They purchase it from wholesalers or manufacturers and then sell
it in small quantity to customers. These people have a duty to fulfil demands and needs of
customers by understanding and analysing the market (Verhoef, Kannan and Inman, 2015). They
provide goods to individuals through developing a strategic plan which includes all decisions
related to price, promotion, place, product, process etc.
Nowadays, shopkeepers also use online retailing process to expand their market share.
Various retailing theories are used by group to attract and retain small group of person buying
products. These practices are followed by individuals through critically analysing market and
consumers. All the factors like size, stage market competitiveness and attractiveness,
segmentation, values and attitudes are evaluated by retailers before selling any product. Fashion
retailing comprises flow of new designs, colours and trends from merchandise agent to local
consumers (Piotrowicz and Cuthbertson, 2014). Successful marketing depends on adhering to
consumer needs, desires, and designing products according to that.
Marks and Spencer also known as M&S is a one of the most popular British
multinational retailer which heheadquartered in London. They are specialised in selling clothes,
food and home products. Company have more than twenty-one hundred retail outlets across the
world. They are engaged in providing quality and best service to their customers. Products are
designed according to new techniques, methods, likes and preferences of people. For increasing
sale of fashion goods organisation promotes its products through different channels of
distributions which involves wholesalers, agents and retailers. This fashion industry is also
involved in various types of charitable activities like providing funds to NGO's, schools and
organisations like Newlife who works for providing help to medical research and does
campaigning for disabled people.
Marks and Spencer has also expanded their business online in which they provide fashion
related items like clothes, accessories, etc. (Parker and Wang, 2016). Of male, female and
children of all ages. In this internet business, company also tend to provide free home delivery
service of products to their favourite consumers. All policies in organisation is made on basis of
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vision and mission of company which is to satisfy consumer needs by providing them low price
and high quality products. Organisation uses different types of marketing methods like
advertising on radio, television, magazines. They also use social media channels like Facebook,
Twitter, Instagram for promoting products.a Various other techniques like sales promotional
methods are also used which includes discounts, fringe benefits and creating public relationship
through organising seminars, workshops. This helps in building and creating bond of honesty
and trust (Iannone and et.al., 2015). It also helps enterprise in gaining consumer loyalty and
attracting more new individuals. Company also take care of the requirements of their employees,
suppliers, board of management, financiers which helps them in increasing their productivity.
MAIN BODYRelevant changes in macro-environment
Macro-environmental factors have a huge effect on fashion retail industry which can
hinder or foster the growth of company. Retailer should have keen understanding of all
components for better growth of their business.
Political factors: Laws, rules, regulations and policies by government or local authorities
can hinder or foster the growth of fashion industry. Loans, subsidies and various other benefits
provided by government can help company in growing and also allows them to keep products on
low price for consumers (The Macroenvironmental Factors Affecting the Clothing Industry,
2017). However, it can also hinder growth of company like imposing tax on import or export of
goods or requiring development of new system and integration which cannot be afford by small
retail stores.
Economic factors: Marks and Spencer should have a critical analysis on economic
factors which includes demand and purchasing power of consumer. They should sale their
product after keen analysing if country is having boom period which would result in increase in
sale of products due to high disposable income. Inrecession period organisation may face
downfall in purchase of product (Utami and Lantu, 2014). Clothing industries should also keep
in mind that they sell their goods on subsequently lower price which attracts more consumers.
Inflation rate, fiscal policies of government also have an impact on company’s business.
Social factors: Factors like culture, traditions, beliefs, trends also have an impact on the
growth of fashion retail industry. Retailers have a responsibility to create merchandise which are
socially acceptable like environment friendly goods, commodity which does not hurt sentiments
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of others. They also have duty to put restrictions on potentially harmful products and keep
warning signs on dangerous goods. Retailers who fails to adhere with social norms of particular
country are not accepted by consumers. They should have a keen understanding of social market
which would help them in expanding business.
Technological factors: Technology only does not help organisation in creating new
products, but also offers them with opportunities to increase the sale of goods and manufacture.
To survive in a dynamic and uncertain environment fashion retail industry should follow the
latest techniques to promote their products. Company can face de-growth if they are involved in
using old methods (Sun and et.al., 2014). To gain competitive advantage, organisation should use
internet for promoting and selling their products. Besides, risk can also be because of
competitor’s products and change in consumers taste and preferences. Marks and Spencer should
have keen evaluation of all these factors which can help them in growing their business.
Legal factors: Fashion industry are frequently affected by industrial laws and policies.
Issues can be related to workers’ rights and child labour. Union groups may go on strike if their
wages are lower than competitor’s industry which might negatively affect the growth of
company. Organisation should not be involved in failure to adopt any rules and policies by
government. For example, rules related to child labour should be followed and company should
not appoint any kid for working with them. This can help in creating their brand value.
Environmental factors: Ecology and sustainability factors are also important for fashion
retail industry. Even these organisations need to take care of safety and cleanliness of the
places in which they are operating. For serving this purpose, they are investing in ozone-
friendly products and raw-materials. Marks and Spencer are also involved in activities like
they have prohibited the use of polythene bags and are re-using renewable plastic material
in creating home or décor products (Marzband and et.al., 2016). Research shows that in an
emerging market large number of consumers prefer buying sustainable commodities.
Company has encompassed sustainable goals and working on achieving these objectives.
Relevant changes in micro environment
Micro economic factors also have an impact on growth and success of fashion retail
industry. These components involve availability of resources, raw material and cheap labours.
Company should be having proper plan and strategies to meet up these requirements. Elements
which can effect organisation are:
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Customers: Consumers are the heart of any business. Success and growth of industry
depends fully on their satisfaction. It is essential for enterprise to meet the needs and demands of
individuals. Products should also be designed according to their taste, preferences and likings.
They should develop effective marketing plans and policies to fulfil their requirements. For
instance: Marks and Spencer can conduct a survey or poll to know about likings and wants of
people. This can help them in introducing goods according to them. It is also important to have a
knowledge about consumer behaviour, as change in that can affect business severely.
Employees: Productivity and business efficiency depends solely on employees'
satisfaction. Company should have proper recruitment system which helps them in hiring
talented and skilled workers (Freeman, Herriges and Kling, 2014). For example: for keeping
people satisfied industries should be engaged in providing training and education to employees.
Also, they should conduct various activities like role play, management games which can help
organisation in retaining and attracting workers. This will also enhance relationship between
them.
Competitors: They also have an impact on growth of business. Company should have
keen knowledge and analysis of competitors which will help them in gaining competitive
advantage. For instance evaluation of substitute’s products and price should also be done by
industries which can help them in fixing cost. Large number of competitors usually shows a lot
of need for services. Fashion industry should take it as an opportunity and plan their objectives
according to that.
Media and public: Media promotion also have an influence on growth of company. For
example, company who are engaged in advertising their goods on media platforms like
Facebook, Instagram, Snap chat, radio, television and magazines attracts large number of
consumers. People prefer those products which are being advertised by organisation over goods
that are not being promoted (Parker and Wang, 2016). Fashion retail industries should be
involved in creating creative and innovative promotional techniques which can influence more
consumers.
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Suppliers: Distribution channel and suppliers can also help company in growing. For
instance, Industries should have proper channels which includes wholesalers and retailers
that can help them in expanding their market and will also attract numerous consumers
across the globe. It will also help company in gaining instant feedback from individuals
that can support organisation in knowing their strength and weaknesses. Consumer’s
problems can also be solved quickly through help of these channels. This also helps
organisation in building relationships of trust and gain customer loyalty which results in
growth of business. Strategies and tactics that can be used to overcome challenges
Fashion retail industries like Marks and Spencer are involved in providing quality
products with low price to consumers. These industries are surrounded by various issues which
can be internal or external. Macro-environment factors like political, economic, social,
technological, legal and environmental also impact working of company. These elements can
hinder or foster the growth of organisation. Macro components like consumers, suppliers,
employees, distribution channel, investors can also affect industries positively or negatively.
Some major challenges which are faced by these industries are change in rules and
policies of government, imposition of taxes on import and export of goods, modification in
consumer taste and preferences, alteration in economic condition of country, etc.(Verhoef and
et.al.,2015). For overcoming these issues industries should deeply interpret customer needs and
demands. They should also have keen analysis and knowledge of competitor’s product, market
condition of particular regions etc. Issues related to suppliers and distribution channels also
affects growth of business. For expanding market share of company, they should maintain
healthy relationship with wholesalers and retailers. It will also help them in knowing strength
and weaknesses which can support them in gaining competitive advantage.
Technological problems are also faced by these industries. Market analysis should be
done by managers to know about the latest trends and fashion. Companies which are involved in
using old methods would find it difficult so survive in competitive market. Overcoming these
challenges may force enterprise to sell their fashion outlets by entering internet. Promoting their
goods on social media channels would encourage more consumer to buy it. Also, these methods
are usually very low in cost, so company can save huge amount of expenditure which are
involved in marketing services. Organisation should be sending emails regarding benefits of their
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products to all the individuals who have made purchase with them. These practices can help
them in making consumer aware about the product and will also attract new customers.
Sales promotional activities like offering discount coupons, free home delivery, after
sales services can also be used by Marks and Spencer to encourage more purchase by individuals
(Modak and et.al., 2016). These schemes can help industries in incorporating a different and
unique brand image. It will help in increasing goodwill of the company. Company’s website
should consist of all the features of fashion related products and social media outlets can be used
to drive people to the goods displayed on internet site.
Several strategies and tactics like retailers should be engaged in changing fashion with
advancing time. As, consumers taste and preferences are altered on regular basis. Industries
should keep a pace with it and involve in bringing new concepts to consumer. For improving
sales industries should also bring innovative packaging which can attract people to buy the
goods. One of the major issue faced by organisation is employee satisfaction. For increasing
workers' engagement in task company, should adopt some methodologies.. Motivating team
work can help industry in retaining talented and skilled employees. This process helps people in
completing tasks early and easily (Jerath, Kim and Swinney, 2017). Also, it supports in building
relationship between subordinates and boss, suppliers and employers which helps company in
improving their efficiency and productivity.
For increasing operational skilfulness organisations should also motivate employees and
encourage their participation in decision making process. This would also support firm in gaining
new ideas and concepts which can provide competitive advantage. Open discussion should be
enhanced by managers which will help them in knowing their flaws and satisfaction level of
employees. It will also support creative and innovative ideas from workers that will help
employees in feeling appreciated. This would lay impact on organisation success.
Recommendations
Retailers are persons who have been engaged in reselling of tproducts given by
manufacturers. There are many challenges which are being faced by them. For being in
competition they should have the ability to overcome these challenges. It can be done by keeping
a track on consumer’s needs, demands, likes and preferences. These behavioural changes of
customer hold a key place in success of fashion retail industry. They should also be involved in
providing creative and innovative goods to individuals (Creative Marketing Strategies for the
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Fashion Industry, 2017). Company should be engaged in selling quality products on low price
which would attract more consumers. Industries should make use of updated technology like
providing clothes and accessories online that would be beneficial for both consumers and
manufacturers. For growing business managers should have keen analysis of competitors and
substituent products.This will help them in gaining competitive advantage. It also help in
improving their good will in market.
CONCLUSION
This to summarise that the above report was based on retail theory and practice. It shows
that retailers are those persons who is in charge of reselling the goods, they are not termed as
manufacturer of the product. They purchase it from whole sellers or producers and then sale it in
small quantity to customers. Further it shows that many challenges including micro and macro-
environment factors are faced by company. Political components like change in government
policies can hinder or foster growth of organisation. Competitors can also impact growth of
business. Report shows that for overcoming these issues keen market analysis should be done by
retailers and also they should lay emphasis on using updated techniques like selling fashion
products online.
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REFERENCES
Books and journals
Verhoef, P.C., Kannan, P.K. and Inman, J.J., 2015. From multi-channel retailing to omni-channel
retailing: introduction to the special issue on multi-channel retailing. Journal of
retailing.91(2). pp.174-181.
Piotrowicz, W. and Cuthbertson, R., 2014. Introduction to the special issue information
technology in retail: Toward omnichannel retailing. International Journal of Electronic
Commerce. 18(4).pp.5-16.
Parker, C.J. and Wang, H., 2016. Examining hedonic and utilitarian motivations for m-
commerce fashion retail app engagement. Journal of Fashion Marketing and
Management: An International Journal. 20(4).pp.487-506.
Iannone, R. and et.al., 2015. Modeling fashion retail supply chain through causal loop
diagram. IFAC-PapersOnLine. 48(3). pp.1290-1295.
Utami, R.M. and Lantu, D.C., 2014. Development competitiveness model for small-medium
enterprises among the creative industry in bandung. Procedia-Social and Behavioral
Sciences.115. pp.305-323.
Sun, Y. and et.al., 2014.November. UK-based external business environment analysis of outdoor
adventure clothing using the PESTEL tool and its future outlook. In Information
Technology Systems and Innovation (ICITSI). 2014 International Conference on (pp.
306-309). IEEE.
Marzband, M. and et.al.,2016. Non-cooperative game theory based energy management systems
for energy district in the retail market considering DER uncertainties. IET Generation,
Transmission & Distribution.10(12). pp.2999-3009.
Freeman III, A.M., Herriges, J.A. and Kling, C.L., 2014. The measurement of environmental and
resource values: theory and methods. Routledge.
Verhoef, P.C. and et.al., 2015. From multi-channel retailing to omni-channel retailing:
introduction to the special issue on multi-channel retailing. Journal of retailing.91(2).
pp.174-181.
Modak, N.M. and et.al., 2016. Pricing policy and coordination for a distribution channel with
manufacturer suggested retail price. International Journal of Systems Science:
Operations & Logistics.3(2). pp.92-101.
Jerath, K., Kim, S.H. and Swinney, R., 2017. Product quality in a distribution channel with
inventory risk. Marketing Science.36(5).pp.747-761.
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Online
The Macroenvironmental Factors Affecting the Clothing Industry. 2017. [ONLINE] Available
through: <https://smallbusiness.chron.com/macroenvironmental-factors-affecting-
clothing-industry-37254.html>.
Creative Marketing Strategies for the Fashion Industry. 2017. [ONLINE] Available through:
<https://smallbusiness.chron.com/creative-marketing-strategies-fashion-industry-
67393.html>.
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