Business Environment Analysis: Marks & Spencer's Situation Report

This report presents a comprehensive situational analysis of Marks & Spencer, a major British multinational retailer. It begins with a summary of M&S's mission, vision, and values, along with key objectives. The core of the report is a detailed analysis of the business environment, including both internal and external factors. The internal analysis utilizes a SWOT framework to examine the company's strengths and weaknesses. The external analysis covers political and legal factors, and applies Porter's Five Forces model to assess the competitive landscape. The report concludes with recommended actions and a summary of the findings, emphasizing the importance of continuous environmental analysis to minimize negative impacts and capitalize on opportunities. The report includes references to academic sources and online materials.

Situational
Analysis

Table of Contents
SUMMARY.....................................................................................................................................1
ANALYSIS......................................................................................................................................1
IDEAS FOR ACTION.....................................................................................................................4
CONCLUSION ...............................................................................................................................4
REFERENCES................................................................................................................................5

SUMMARY
Marks & Spenser is major British multinational retailer which was founded in 1884 by
Michael Marks and Thomas Spencer. Its headquarter is located at Waterside house, 35 North
Wharf Road, Paddington, London, United Kingdom (Vrska Jr, Pergande and Spencer, 2017).
Products offering by them are clothes and accessories of men's, women's as well as children at
worldwide level.
 Mission - Mark and Spencer Mission are to make inspirational quality accessible to
others.
 Vision - Mark and Spencer vision is to be the standard against which others are
measured- Benchmarking.
 Values - Mark and Spencer Values are Quality, Service, innovation and trust.
Apart from this, there are some key objective of Mark and Spencer Explanation of these
are as follows :-
 Employees orientation – Company have high expectations from their staff as they will
contribute more within working of Mark and Spencer. Their is requirement of succession
management as well as developing career path for staff members. Thus, it is part of The
Mercantile London to attract, motivate as well as retain their high calibre staff because
they will assist in business transformation and also deliver improved performance.
 Organisational objectives – Mark and Spencer organisational objective is to regain their
leadership in clothing as well as specially food (Scott and Walker, 2017). Respective
objective will accomplish through translating their scale and authority into superior
quality, value as well as appeal.
 Sales Objectives – It has been belief by respective organisation that there is plenty of
room for enhancement within sales per foot. Mark and Spencer saw return per foot as key
operational objective going forward.
ANALYSIS
Business environment is sum of internal as well as external factors which have their
direct impact on working of an organisation. It is important for Mark and Spencer to analyse
these factors through proper framework because it will help in minimising negative impact and
gaining positive outcomes. Thus, External and internal analysis are as follows :-
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SWOT analysis – Mark and Spencer aim behind conducting SWOT analysis is to
explore internal as well as external factors which affect working of respective organisation
(SWOT analysis of Marks & Spencer, 2019). Here, strength and weakness is part of internal
business as well as opportunity and threat are part of external business.
Strength Mark and Spencer have its great reputation in
market for quality of its products (Oh and et.
al., 2016). It is premium supermarket and now
became the 2nd best store supermarket in UK.
Mark and Spencer have approx. 80,000 staff
working within their showrooms and offices at
global level. Thus, respective organisation
encourage diversity and have employees from
all ethnicities, religions and genders. Along
with this, they ensure equal opportunity
without no discrimination.
Weakness Mark and Spencer have its presence primarily
in Europe, UK and US. They also opened
stores in Asia and Middle east in which they
have been unsuccessful in gaining customers
attraction primarily because almost offering of
Mark and Spencer is western not traditional.
Company face low satisfied level from their
customers due to their return policy as well as
in-store experience (Jin, Miao and Park, 2018).
This result in poor brand loyalty and increased
brand switching.
Opportunity Fashion is evolving business as well as new
segments coming up on regular basis. Thus,
Mark and Spencer have opportunity to invest
in new segment foe ethnic and traditional wear
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in Asia.
Threats Fashion industry is highly competitive and
level of competition increasing day by day
which became threat for The Mercantile
London. As they have several competitors such
as Uniqlo, Gap, Tommy Hilfiger, Zara and
many more.
Apart from this, It is important for an organisation to analyse external factors also along
with internal because they have direct impact on working of company. External factor analysis of
Mark and Spencer are as follows :-
 Political factors - Free trade policies have its massive benefits for Mark and Spencer
and its approx. 1500 overseas stores. But after Brexit most of these policies will not apply
to the company any more. Thus, Brexit result in increasing production cost of respective
company. If UK falls apart then overseas outlets of Mark and Spencer have to shut down
or increase prices which may result in losing customers.
 Legal factors – Mark and Spencer has been involved in multiple legal disputes over the
year and this result in hard for brand to hold their image. The recent legal dispute with
Frascati landlord was one out of such disputes. The change in Britain’s trade laws post
Brexit will be another legal factor that will affect the brand hugely. This is something that
a business strategy will not be able to elevate.
These both factors have wide impact on working of an organisation as it is essential for Mark
and Spencer to analyse these in effective manner before conducting their operations. As legal
and political factor have both positive as well as negative impact on working of an business firm.
Porters five force model – It is an strategic management tool which utilise for analysing
industry as well as for understanding underlying levers of profitability (Voss and et. al., 2019).
Explanation of porters five forces are as follows in relation of Mark and Spenser. Threat of new entrants – Mark and Spencer have low threat of new entry within market
because there is requirement of huge funds to enter within this market. Bargaining power of suppliers – It is low because concentrated purchase from British
Suppliers.
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 Bargaining power of buyers – Their is high bargaining power of buyers because
customers are price sensitive. Threat from substitute – Mark and Spencer's have high threats from substitutes as there
are several retail organisation within business environment who are dealing in same range
of offerings (Dooley, 2017).
 Rivalry among existing players – For Mark and Spencer there is high rivalry within
existing players because products are of similar quality, price and so on.
IDEAS FOR ACTION
For Mark and Spencer it has been recommended that, they have to conduct internal and
external analysis on timely basis. Because business environment is dynamic in nature as in this
several modifications take place which need to be consider. So that, their negative impact will
minimise as well as positive will implement within organisation.
CONCLUSION
After going through above discussion it has been concluded that, for an organisation it is
important to conduct internal as well as external analysis. Because these may have positive and
negative both impact on working of company. There are several tool which help in analysing
internal and external factors such as SWOT analysis, political and legal factor analysis as well as
Porter's five force model.
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REFERENCES
Books and Journal
Vrska Jr, M. D., Pergande, J. C. and Spencer, M. A., Wilson Sporting Goods Co, 2017. Iron-type
golf club head with body wall aperture. U.S. Patent 9,662,549.
Scott, P. and Walker, J. T., 2017. Barriers to ‘industrialisation’for interwar British retailing? The
case of Marks & Spencer Ltd. Business History. 59(2), pp.179-201.
Oh, S. and et. al., 2016. Development Direction Research Of Korean Lifestyle Brands Through
Analysis For Global Lifestyle Brands-Focused On The Trend Analysis. International
Business & Economics Research Journal (IBER). 15(2), pp.41-54.
Jin, H., Miao, Y. and Park, S. T., 2018. A Case Study of Marks and Spencer lost China. Journal
of Industrial Convergence. 16(2), pp.15-23.
Voss, H. and et. al., 2019. International supply chains: compliance and engagement with the
Modern Slavery Act. Journal of the British Academy, 7(s1), pp.61-76.
Dooley, K., 2017. Value chain systemicity: Promoting organizational creativity and
environmental sustainability in low velocity industries. Journal of cleaner
production, 140, pp.1903-1913.
Online
SWOT analysis of Marks & Spencer, 2019.[Online].Available
through<https://www.marketing91.com/swot-analysis-of-marks-spencer/>
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