Analysis for the Business Environment of Marks & Spencer

Background information about M&S

In terms of products, M&S developing their own knowledge and understanding for offering exact goods which is required by customer's at marketplace (Acuña-Carvajal, and et. al,. 2019). Thus, they are focusing on their each and every product by which they can easily satisfy consumer's needs and wants through giving them high quality of goods. As this brand deals with large number of home appliances, clothing and many more so that it increase market value of respective firm and encourage them to achieve specific goals on time. By having such kind of background they have opened so many stores in different different place in order to increase themselves productivity and profitability to attain competitive advantages in an effective manner. Therefore, by having large number of stores globally, they have opportunities to gain successful business.

Product and services of Marks and Spencer

M&S is leading British retailer that always bring high quality, great value of food items, clothing and home ware to large number of people across the globe. Food items of this brand includes different types of food and taste that directly influence several customers at one time. This is because respective organization use new techniques and supply chain of their items by which they can give better quality food of their customers and make them happy. Through applying innovative thoughts within the food they become more relevant and gain high profits. On the other side, this brand dealing with clothing and home wares that reflected their sales in a positive manner (Amran, and et. al., 2016). When this brand saw rise in consumers numbers and their growth towards purchasing products of this company than their aspiration is to be famous for effective value of business. Thus, their efforts towards making several kind of home appliances and fashionable clothes has been increasing day to day. At present time the main aim of this brand is to become more successful and develop huge competition for others at marketplace. Sometimes respective firm has faced few issues while manufacturing its goods such as lack of employs, funds, machines and so on. In order to improve these sorts of issues they have been developed training and development programmes for their employees so that they worked effective and able to achieve goals successfully (Johnson, 2016). Therefore, the effective collaboration of different products have positive impact on customers that maximising overall sales of respective firm with high profit and sales properly. 

Analyse the competitive environment of M&S by applying Porter's Five forces model

This is a strategic tool used by management of the company for analysing industry and profitability levers. The leaders of M&S uses this model for determining different competitive forces which affects profitability. These are used for developing strategy and enhancing competitive advantage of M&S. By evaluating this model effectively, M&S is able to attain competitive edge in market. There is need for analysing this model in effective manner. This is an important part for an organisation to analyse the need of competitive advantage that will help a company to build within market. It is essential for a company like Marks and Spencer to know it's value within market as in this way, the managers will know what are the segments in which this company can work. The managers and leaders of M&S have to pay more attention for analysing market condition. The five forces given by Porters model are explained below -

Threat of new entrants: This is defined as entrance of new entrants in the market for identifying competitive edge. The main reason behind this is that M&S is taking enormous capital investments for setting up new and successful retail stores (Kono, 2016). Market of retail industry is mature and this requires offering of new products in market and gaining competitive edge. Different major retailers of market are establishing strong brand image. It is helpful in increasing customer loyalty and trust. Major business people know in what way business ethics should be done and market share will be enhanced. There is barrier for foreign companies to enter international markets. Marks and Spencer has good reputation and it has strong image in market. This helps it to have low threat of new entrants.

Threat of substitutes: In the retail market, there are no substitute of clothes and food. The threat of substitute for M&S is very low. There is substitution of products offered by M&S like there are many other brands who are selling clothes and apparels. But the quality which is provided by this company is very high. Big brands like Waitrose and Tesco are rivals of this company as they are also providing good quality products (Lai, Melloni, and Stacchezzini, 2016). The other companies like Peter Jones and John Lewis are major competitors of M&S as they offer high quality clothes and apparels. On the other hand, ASDA and Tesco have launched alternatives and they are selling dinner jackets. The threat of substitution of M&S is high.

Bargaining power of customers: It is defined as framework in which customers could place business for getting high quality products and services. The bargaining power of buyers within M&S is high. The number of buyers in market for apparels and other products sold by this company are high. There are many options for people to go in different brands for buying their favourite stuff. The economy of UK is slowing down since 2008 and this has forced retail brands to lower their price and offer products. Income of people has become uncertain and thus customers are shopping in different brands.

Bargaining power of Suppliers: It is referred to forces on suppliers that company could increase its prices as well as reduce the prices. This power in context opf M&S is very low. This is one of the huge brand in market and the profits earned by this company are also high. This brand is seen to sell products of own brand (Linder, and Williander, 2017). This brand is not dependent on suppliers. They are having their own way to provide goods in different region of the world. They manage the raw materials and goods on their own. The basic selling and supplying of this brand depends upon western company contract.

Competitive Rivalry: It is analysis of competition towards the various existing firms. The competition in retail sector is very high and it is important for this company to work hard and develop strategies that will help in gaining competitive edge. This company is facing vulnerable competition and it is dealing in various sectors like food, clothes, apparels, etc.

From above analysis of Porter Five Forces Model, it is analysed that Marks and Spencer is facing great competition in market. It is essential for this company to manage it's strategies effectively and do great work for attaining organisational goals and o