'Marks & Spencer SWOT and PEST Essay\r'

'tag and Spencer is the British multinational retail comp any that specializes on producing raiment and high-quality nutrient. Being the dominant intensity on the UK marketplace label and Spencer owns 600 stores in the home country and over 225 stores fieldwide. gentlewoman (1986) claims label and Spencer to be the most knock-down(a) image of Great Britain; the phvirtuosor authoritatively beingness the most profitable UK system of rules also is i of the most ripe in the world. Two master(prenominal) features of the mark and Spencer are centralization and simplicity. The firm tends to utilisation centralized organizational structure and tries to throw eitherthing simple avoiding the complexity in any aspect of systematic applications (Howells, 1981).\r\nStrengths:\r\n attach and Spencer has been cognise for its highest standards of fair-trading, which include acquiring strong contacts with current suppliers, producing and proposing high-quality feed, being frien dly to the staff and having a flexible exchange policy for alive customers (Grayson, 2011). Having a shelter and positive record is inevitable for the walloping worldwide brands. The social club being initially solo concentrateed on producing garments lately diversified its market to the new(prenominal)(a) sectors, such as food, electronics and piece of furniture (Hamil, Crosbie, 1990). Diversification see to itd volumedger amount of customers for the bon ton and expanded its growth. The caller tends to locate its stores in the high streets which leads to obtaining large amount of customers every day and therefore larger profit. (Bird, Witherwick, 1986). Further a great deal, attach and Spencer does non rent the premises, it owns stores eliminating the possible lease costs. mark and Spencer is an international retailer which owns more than thousand shops approximately in twoscore countries, covering market of such a ample size is beneficial for the gildâ€℠¢s income (Salmon, Tordjman, 1989). consort to Doyle (1982), mark and Spencer is the Britain’s strongest and most successful brand that makes go with well known around the world and differentiates it from competitors devising it unique.\r\nWeaknesses:\r\ntag and Spencer due to diversification and operating in more than one market (garments, food, furniture) is non concentrated on any particular segment, unlike its main competitors such as Tesco and Sainsbury’s which retail only food (Lewis, Thomas, 1990). The lack of the focus and concentration may lead to the cut back innovations and scarcity of the expertise in one particular market area. When label and Spencer age-tested to expand their market adding the clothing origination for junior people, it experienced loss and failure, as it wasn’t able to follow latest fashion trends to avenge younger hearing and kept a nature of the retail brand mainly for elder women (Fletcher, 2007). concord to Alo n (2000), tag and Spencer experienced lack of take stock control which take to the underperforming new(prenominal) study British companies by 25% in 1998. The average price comparison do by Telegraph in 2008 has shown that the prices on the Marks and Spencer’s food overtake those in Asda by 3.6%. The company is packed pricy and looses large amount of customers from middle and swallow class, who prefer daily shopping in other big retail durance like Asda, Sainsbury’s and Tesco, where prices are much cheaper and more reasonable (Avery, 2011).\r\nPolitical factors:\r\n separately company which desires to maximize its profit should let on within the political relational policies. Marks and Spencer is not an exception, as the company believes that engagement with the government is beneficial for the organization’s income. accord to Marks and Spencer’s official website, company tends to communicate with the political audiences either in a flash or through the trade memberships. by and by the â€Å"green” governmental policy in 2008, Marks and Spencer introduced the 5p charge for the plastic bags cross representations its stores (Vaughan, 2011). Marks and Spencer is located in the UK, which has stable political background and impose policies (McGrattan, 2005). However, in 2005 the company experienced losses in the EU area and appealed to the court for the opportunity to deduct international losses from its UK tax bill (European Commission Legal Services, 2005). subsequent European Court of Justice inform that Marks and Spencer and other UK companies bedevil the remediate to counterpoise British tax bill, Marks and Spencer has won this case receiving 30 zillion tax relief (BBC, 2005).\r\nEconomic factors:\r\nThe legal age of international companies are considering the regular army a perfect area of franchising due to the big population and large size of the market. Marks and Spencer was among the first Briti sh retailers who considered expanding its business to the mating America (Alexander, 1995). However, the September 11 attacks invite caused economic crisis and change in the buy behavior of Ameri tail assembly citizens which led to the organic losses experienced by Marks and Spencer throughout the following year imposing the company to close the non-core branch in North America (BBC, 2002). Due to the monetary crisis pickings place in 2007-2008 (Barrel, 2008) and later severe crisis in Eurozone, the sales of Marks and Spencer has significantly decreased, as the salaries of the middle-class didn’t math the high-priced food and garments offered by the retailer (Rayner, 2008).\r\nSocial factors:\r\nAccording to Marks and Spencer’s official website, company is pore on applying ethical trading, producing nontoxic food and employing responsible use of an energy, as the company believes that adapting CSR is vital for the development of business. Company is especially focused on the animal welfare, being the first UK retailer to sell only free-range eggs in its stores (Jones, 2005) and on with several other British retailers promotes food without additives (Jones, 2007). However, several years ago Marks and Spencer was accused in using the kid labour in Morocco which might have damaged the company’s reputation (Frankental, 2001). According to Moore (1995) and Campbell (2010) Marks and Spencer over the foregone years has increased the amount of advertizing using different types of commercials. Nevertheless, the company was not been able to satisfy customers’ needs, while producing their clothing line for young people which led to the losses of profit (Jobber, 1999).\r\nTechnological factors:\r\nAccording to Butler (2013), Marks and Spencer is the only big British food retailer that does not have an online shopping service, while other companies like Sainsbury’s and Morrison are making millions of pounds through the web. The company for the long time is using RFID (Radio Frequency Identification) technology that helped to gain more efficient supply drawing string system. After the success with Marks and Spencer other British supermarkets implemented this technology in order to reduce costs and advance customer service (Jones, 2005). In 2012 Marks and Spencer announced the new marketing externalize that included the wi-fi connection throughout its stores, mean that the customers would be able to see the salutary stock of products on their devises which would simplify scrutinizing for the preferable item (Raddick, 2012).\r\nConclusion:\r\nMarks and Spencer is the powerful international retailer that can maximize its future profit taking into consideration further opportunities and threats of substitutes. Marks and Spencer should consider adding online shopping for its food products, as the other British food retailers like Tesco and Sainsbury’s already have this feature that gives a big per centage of companies’ income. Another way for developing company may be expanding to the Asian market which can guarantee huge profit due to the big size of population. One of the main threats caused by economic crisis both in USA and European Union is the loss of bargain power of customers. People find it trying to afford the high prices offered by Marks and Spencer and therefore try to search for a cheaper alternative. Retailer in future should adapt to the social changes when producing their clothing line for younger people in order to satisfy this audience.\r\n'