Introduction

Marks & Spencer’s also known as M & S is a retailer of clothes

headquartered in the City of London. M & S has approximately 703 stores in United
Kingdom (UK) and 361 retail chains spread across 40 more countries. M & S refers
to a retail chain which mainly deals with the sale of clothes, luxury products, food
items, etc. M & S was originated in the year 1984 by two geniuses i.e. Michael
Marks and Thomas Spencer. Marks and Spencer has maintained its position as
Britain’s fastest growing grocer, according to new research by NielsenIQ. According
to the data, M&S year-on-year sales increased by 12.3% in the 12 weeks to 29
January, giving it a UK grocery market share of 3.6%, 0.4% increase on the year.

In the year 1998, Marks & Spencer’s became the first British retailer which
made a profit of pre – tax profit of approximately £1 billion. Even after making a
profit of £1 billion, Marks & Spencer’s dropped down into crises which lasted for
many years. According to the sources, it shall be taken into consideration that over
21 million visitors visit the retail store each week spread all across the globe. It has
been seen that, Marks & Spencer’s treat its customers with high class quality,
fashionable clothes, value for money prices. In case of home products offered at
Marks & Spencer’s, provide food which is high class quality, outstanding variety of
food items which is being sourced from approximately 2, 000 suppliers all over the
globe. The retail chain i.e. Marks & Spencer’s employs 78, 000 people in the UK
branch alone. Whereas, it has more than 700 stores opened in UK & many more to
come in the international retail environment (Quick MBA Knowledge, 2004).

M&S follows a flat organizational structure; this type of organizational

structure has limited levels of management between administrative level and front-
line employees. This structure is followed in organization to encourage employees in
more decision making process. This structure is followed basically to decrease
bureaucracy and make employees more skilled by authorizing them to make
decisions. And due to less management levels communication between upper
managers and base line employees become easy which allows rapid change and
problem solution (Strinfellow, 2010). The retail market in the UK and across the

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world is getting very competitive. Some of the main competitors of Marks &
Spencer are Amazon, Tesco, John Lewis, ASDA, Debenhams, Sainsbury, Sports
Direct, Morrisons, Gap, and Next.

Porter’s Five Forces

The 5-Forces model concentrates on analyzing the company’s position in

the market with the aim of being a guide to effective strategic management
process. With Rivalry as the central factor, this model evaluates the factors that
may impact a company’s performance under Barriers to Entry, Buyer Power, Threat
of Substitutes, and Supplier Power. For a company to enhance its competitive
advantage, it needs to understand and use these factors to their advantage. The 5
Forces model is summarized by the 5-Forces Diagram below:

The level of rivalry in M&S’s industry had greatly increased with entry of
more firms into the sale of clothing where some organizations such as the Gap and
Oasis offered current fashions whereas firms like the George and Matalan who
offered similar products at lower prices. The high rivalry that struck M&S in the
1990s was due to the fact that the clothing they stocked had become quite common
and their competitors could stock the same fashions hence cutting into their
competitive advantage. This threatened their brand identity which had for a long
time been a mark of reliable quality and style. The rivalry was further enhanced by
M&S fixed costs in relation to labor costs, warehousing costs and a significant
proportion of their operation costs. In relation to supplier power, M&S mainly
sourced products from UK based suppliers who were readily available.

The suppliers were also ready to differentiate their supplies to suit the
quality standards of M&S which resulted in them being able to consistently stock
high quality products. Their relationship with the suppliers was therefore
contributed to their competitive advantage. The ability of differentiated input was
further influenced by their ability to procure large volumes that enabled suppliers
realize the benefits of such differentiation.

Fashion and design appropriateness are important to M&S buyers. High-

end customers place a high value on their preferred clothing and are prepared to

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pay a premium for the items that meet their needs. Buyers at the bottom of the
pyramid are similarly price sensitive, and M&S faced a significant risk of losing
market share to competitors offering cheaper prices for identical items. M&S's
clothing appeared to have near industrial equivalents, which harmed their market
position even more. As proven by M&S retaining a constant clientele before to its
downfall in the late 1990s, consistency in creating trends and quality that delighted
the customer would contribute to brand loyalty among customers. This loyalty
would be jeopardized if a disconnect occurs, causing the companies to lose touch
with changing customers tastes, as seen by M&S' quick fall in the late 1990s. M&S
works in the industry that need constant innovation in order to keep up with
shifting customer demands. This is owing to the simplicity with which rivals may
reproduce existing designs or build close substitutes. If M&S does not stay ahead of
the competition in knowing and fulfilling their specialized market, the industry's
capacity to develop replacements to the items M&S sells might pose a threat.

The threat of new entrants is determined by how successfully M&S and

other top companies can leverage customer brand loyalty to their advantage. The
gap they need to solve is a lack of awareness of customers wants, since this may
be a great launch for a new entrant to enter the market

Innovation

Innovation means to improve or to replace something, for example, a process, a

product, or a service.

CSR

Cooperate social responsibility is a self-regulatory business model that

allows a firm to be socially accountable to itself, its stakeholders, and the general
public. Companies may be aware of their influence on all parts of society, including
economic, social, and environmental issues, by adopting corporate social
responsibility, also known as corporate citizenship (Fernendo, 2022). M&S has
always taken responsibilities to customers, employees, partners, suppliers and local
communities seriously. Doing business in a responsible way underpins their values -
Quality, Service, Innovation and Trust. This section tells you how they manage

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social, environmental and ethical issues across the business. The brand today is
arduously taking care of every sensitive issue of the society be it charity for the
society, issue relevant to climatic changes, industrial waste management,
sustainable raw material management or health people and ethical trading. M&S
aims to make operations in the UK and Republic of Ireland carbon neutral and to
help customers and suppliers reduce their emissions. M&S have committed to stop
sending waste to landfill from their UK and Irish stores, offices and warehouses;
reduce the use of packaging and carrier bags.

The competitor, Tesco have been performing their CSR activities at a

constant level and as a result of which since 2006 they have made a shortfall of the
energy use by the time they were in 2010. Tesco has also been seen that they take
care of the environment as they provide offers in terms of club card points where
the customer would benefit every time they use reusable bags and proper steps
were taken to ensure this and according to the survey it has been seen that they
have found results in protecting the environment at large as half of what it used to
be in 2006 (Tesco, 2009). They also claim that the bags that are used in Tesco are
recyclable. Along with they have also labelled 100 products with an eco-label tag
which is a strong step toward CSR activity considering the mere fact that they are
the largest in the world among retailers and have thousands of products.

Government ethics applies to the processes, behavior, and policy of

governments and the public officials who serve in elected or appointed positions
(John P. Pelissero, 2021).

https://www.retailgazette.co.uk/blog/2022/02/ms-food-grows-market-share-in-
2022/

https://innolytics-innovation.com/what-is-innovation/

https://www.academia.edu/12363914/
A_Strategic_Managemental_review_Of_Marks_and_Spencer_PLC

https://www.locusassignments.com/solution/unit-4-strategic-management-
assignment-marks-spencer

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https://myassignmenthelp.info/assignments/strategic-management-assignment-
marks-spencers/

https://www.investopedia.com/terms/c/corp-social-responsibility.asp

https://www.scu.edu/government-ethics/resources/what-is-government-ethics/