Marks Spencer Case Study Ppt.

BY:

AGUSTIN, GERALDINE G. ARDE, CARLEIL S.D. FERNANDEZ, GWENDALINE

E.

TERMINOLOGIES •

FLAGSHIP STORE- CHAIN’S LARGEST STORE THAT HOLDS OR SELLS THE HIGHEST

VOLUME OF MERCHANDISE OR A CHAIN’S FIRST RETAIL OUTLET. •

FLAGSHIP- THE BEST OR LARGEST MOST IMPORTANT ONE OF A GROUP OF THINGS

SUCH AS PRODUCTS, STORES, ETC. •

TURNOVER - THE AMOUNT OF MONEY THAT IS RECEIVED IN SALES BY A STORE OR 

 

COMPANY.

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INTERVENE- OCCUR IN TIME BETWEEN EVENTS

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PROFIT MARGINS- EXPRESSED AS A PERCENTAGE AND, IN EFFECT MEASURE HOW

MUCH OUT OF EVERY DOLLAR OF SALES A COMPANY ACTUALLY

KEEPS IN

EARNINGS. •

SUBSTANTIAL- LARGE IN AMOUNT SIZE, OR NUMBER 

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PROBING- SEEK TO UNCOVER INFORMATION ABOUT SOMEONE OR SOMETHING

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BUREAUCRACY- A SYSTEM OR GOVERNMENT OR BUSINESS THAT HAS A MANY

MARKS & SPENCER M&S! IS A BRITISH RETAILING INSTITUTION. FOUNDED IN "##$ BY MICHAEL MARKS, A POLISH %EW WHO HAD EMIGRATED TO ENGLAND, THE COMPANY HAS BEEN A NATIONAL CHAIN SINCE THE EARLY "''S. BY "() THE COMPANY HAD A BRANCH IN EVERY MA%OR TOWN IN THE COUNTRY AND HAD BECOME BRITAIN’S LARGEST RETAILER, A POSITION IT STILL HELD IN "). PRIMARILY A SUPPLIER OF CLOTHING AND FOODSTUFFS, M&S IS ONE OF THE WORLD’S MOST PROFITABLE RETAILERS. IN "( M&S’S (#' UNITED KINGDOM STORES HAD SALES OF *+. BILLION. M&S ACCOUNTED FOR ".' PERCENT OF ALL RETAIL CLOTHING SALES IN THE UNITED KINGDOM, AND $.) PERCENT OF ALL FOOD SALES. ACCORDING TO THE GUINNESS BOOK OF RECORDS, IN "" THE COMPANY’S FLAGSHIP STORE AT MARBLE ARCH IN LONDON HAD A TURNOVER OF *,+'' PER SUARE FOOT, MORE THAN AY OTHER DEPARTMENT STORE IN THE WORLD.

M&S PROVIDES A SELECTIVE RANGE OF CLOTHING AND FOOD ITEMS AIMED AT RAPID TURNOVER. THE FIRM SELLS ALL ITS PRODUCTS UNDER ITS OWN ST. MICHAEL’S LABEL. M&S OFFERS HIGH-UALITY PRODUCTS AT MODERATE RATHER THAN LOW PRICES. THIS COMBINATION OF HIGH UALITY AND REASONABLE PRICE ENCOURAGES CUSTOMERS TO ASSOCIATE M&S WITH VALUE FOR MONEY, AND THE FIRM’S ABILITY TO DELIVER THIS COMBINATION CONSISTENTLY OVER THE YEARS HAS BUILT UP ENORMOUS GOODWILL FROM CUSTOMERS IN BRITAIN. IN FACT, SO STRONG IS M&S’S REPUTATION AMONG BRITISH CONSUMERS THAT THE COMPANY DOES NO ADVERTISING IN THAT MARKET.

TO ACHIEVE THE COMBINATION OF MODERATE PRICES AND HIGH UALITY, M&S WORKS VERY CLOSELY WITH ITS SUPPLIERS, MANY WHOM HAVE BEEN SELLING MA%OR PORTION OF THEIR OUTPUT TO M&S’S PRACTICE OF HAVING ITS TECHNICAL PEOPLE WORK CLOSELY WITH SUPPLIERS ON PRODUCT DESIGN. SUPPLIERS ARE MORE THAN WILLING TO RESPOND TO THE FIRM’S DEMANDS, FOR THEY KNOW THAT M&S IS LOYAL TO ITS SUPPLIERS AND AS IT GROWS SO DO THEY. THE SALES VOLUME GENERATED BY M&S’S STRATEGY OF PROVIDING ONLY A SELECTIVE RANGE OF CLOTHING AND FOOD ENABLES M&S’S SUPPLIERS TO REALIZE SUBSTANTIAL ECONOMIES OF SCALE FROM LARGE PRODUCTION RUNS. THESE COST SAVINGS ARE THEN PASSED ON TO M&S IN THE FORM OF LOWER PRICES. IN TURN, M&S PASSES ON PART OF THE SAVINGS TO THE CONSUMER.

CRUCIAL TO M&S’S EFFECTIVENESS IS A CLEAR FOCUS THE CUSTOMER. THE TONE IS SET BY TOP MANAGEMENT. EACH SENIOR MANAGER MAKES A HABIT OF WEARING M&S CLOTHES AND EATING M&S FOOD. THUS MANAGERS DEVELOP AN UNDERSTANDING OF WHAT IT IS THAT CUSTOMERS WANT AND LIKE ABOUT M&S PRODUCTS/ BY STAYING CLOSE TO THE CUSTOMER, THEY CAN IMPROVE THE UALITY AND DESIGN OF THE PRODUCTS THEY OFFER. THE FOCUS ON THE CUSTOMER IS REINFORCED AT THE STORE LEVEL BY STORE MANAGERS WHO MONITOR SALES VOLUME AND UICKLY IDENTIFY LINES THAT ARE SELLING AND THOSE THAT ARE  NOT. THEN STORE MANAGERS CAN TRANSMIT THIS INFORMATION TO SUPPLIERS, WHICH HAVE THE CAPACITY TO MODIFY THEIR PRODUCTION UICKLY, INCREASING THE OUTPUT OF LINES THAT ARE NOT MOVING. •

ON

ANOTHER CENTRAL FEATURE OF M&S IS ITS PIONEERING APPROACH TO HUMAN RELATIONS. LONG BEFORE IT BECAME FASHIONABLE TO DO SO, M&S HAD DEVELOPED A COMMITMENT TO THE WELL-BEING OF ITS EMPLOYEES. M&S HAS ALWAYS VIEWED ITSELF AS A FAMILY BUSINESS WITH A BROAD RESPONSIBILITY FOR THE WELFARE OF ITS EMPLOYEES. M&S HAS ALWAYS VIEWED ITSELF AS A FAMILY BUSINESS WITH A BROAD RESPONSIBILITY FOR THE WELFARE OF ITS EMPLOYEES, M&S OFFERS EMPLOYEES MEDICAL AND PENSION PLANS WITH BENEFITS THAT ARE WELL ABOVE THE AVERAGE WITHIN THE INDUSTRY. LIKEWISE, THE COMPANY PAYS ITS EMPLOYEES AT A RATE THAT IS WELL ABOVE THE AVERAGE WITHIN THE INDUSTRY, AND IT MAKES A PRACTICE OF PROMOTING EMPLOYEES FROM WITHIN, RATHER THAN HIRING OUTSIDE. FURTHERMORE, THERE ARE A SERIES OF IN-STORE AMENITIES FOR EMPLOYEES, INCLUDING SUBSIDIZED CAFETERIAS, MEDICAL SERVICES, RECREATION ROOMS, AND HAIRDRESSING SALONS. THE REWARD FOR M&S IN THE TRUST AND LOYALTY OF ITS EMPLOYEES AND, ULTIMATELY, HIGH EMPLOYEE PRODUCTIVITY.

ALSO VITAL IS THE COMPANY’S COMMITMENT TO SIMPLIFYING ITS OPERATING STRUCTURE AND STRATEGIC CONTROL SYSTEMS. M&S HAS VERY FLAT HIERARCHY / THERE IS LITTLE IN THE WAY OF INTERVENING MANAGEMENT LAYERS BETWEEN STORE MANAGERS AND TOP MANAGEMENT. THE FIRM UTILIZES %UST TWO PROFIT MARGINS, ONE FOR FOODSTUFF AND ONE FOR CLOTHING. THIS PRACTICE REDUCES BUREAUCRACY AND FREES ITS STORE MANAGERS FROM WORRYING ABOUT PRICING ISSUES. INSTEAD, THEY ARE ENCOURAGED TO FOCUS ON MAXIMIZING SALES VOLUME. CONTROL IS ACHIEVED PARTLY THROUGH FORMAL BUDGETARY PROCEDURES AND PARTLY THROUGH AN INFORMAL PROBING PROCESS, IN WHICH TOP MANAGEMENT DROPS IN UNANNOUNCED AT STORES AND UIZZES MANAGERS THERE ABOUT THE STORE. IN A TYPICAL YEAR, %UST ABOUT EVERY STORE IN BRITAIN WILL RECEIVE AT LEAST ONE UNANNOUNCED VISIT FROM TOP MANAGEMENT. THIS KEEPS STORE MANAGERS ON THEIR TOES AND CONSTANTLY ALERT TO THE NEED TO PROVIDE KIND OF VALUE-FOR-MONEY PRODUCTS THAT CUSTOMERS HAVE TO ASSOCIATE WITH M&S.

I.

TITLE: MARKS & SPENCER 

II.

VIEWPOINT: MICHAEL MARKS, FOUNDER OF MARK & SPENCER 

III. TIME CONTEXT: EARLY 1900’S

IV.SWOT ANALYSIS STRENGTHS • • •

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B012314’5 6307852 08231680 M&S 15 948 9 2;8 952 ?09123@68 08231680  I4 "(, M&S’5 (#' U4128= K147=9> 529085 ;3= 53685 9 *+. @166194. A90=147 29 G144855 B99 9 R890=5, 14 "" 2;8 9>?34’5 6375;1? 52908 32 M30@68 A0; 14 L94=94 ;3= 3 204980 9 *+'' P091=8 3 5868218 03478 9 692;147 34= 99= 128>5 31>8= 32 03?1= 204980. O805 ;17;-3612 ?09=25 32 >9=80328 032;80 2;34 69< ?0185. W905 80 69586 @1432194 9 >9=80328 ?0185 34= ;17; 3612.  S3685 96>8 78480328= @ M&S 5203287 843@685 2;810 5??61805 29 083618 5@52342136 8949>15 9 5368 09> 63078 ?09=2194 045.

WEAKNESS • •

 N9 3=80215147 T;8 9>?34 ;3= 3 @034; 14 880 >390 29805 @ >3147 83; 584190 >343780 34 086321945 S1>?6118= 9?8032147 520208 34= 52032871 942096 5528>5. S??6180 9 692;147 34= 99=525 A9428= 90 ".' ?80842 9 366 082316 692;147 53685 14 U4128= K147=9>, 34= $.) ?80842 9 366 99= 53685.

COMPETITIVE ADVANTAGE EFFICIENCY

⁻ MAINTAIN A GOOD RELATION OR COORDINATE WITH ITS SUPPLIERS ⁻ SENIOR MANAGERS MAKES IT A HABIT TO WEAR M&S CLOTHES AND EAT M&S FOO, THUS MANAGERS

DEVELOP AN UNDERSTANDING OF WHAT IT IS THAT THE CUSTOMERS WANT AD LIKE ABOUT M&S PRODUCTS.

⁻ INCREASING THE OUTPUT OF LINES THAT ARE SELLING WELL AND REDUCING THE LINE OF OUTPUT OF LINES THAT ARE NOT MOVING.

⁻ STRATEGY OF PROVIDING ONLY A SELECTIVE RANGE OF CLOTHING AND FOOD ENABLES M&S SUPPLIERS TO REALIZE SUBSTANTIAL ECONOMICS OF SCALE FROM LARGE PRODUCTION RUNS.

⁻ UNEXPECTED VISITS FROM TOP MANAGEMENT UALITY

- MODERATE PRICES AT HIGH UALITY CUSTOMER RESPONSIVENESS

- COMBINATION OF HIGH UALITY AND REASONABLE PRICE ENCOURAGES CUSTOMERS TO ASSOCIATE M&S WITH VALUE FOR MONEY.