Michael and by the sass’s, nearly all goods were sold under the SST. Michaels brand. Women’s and girl’s apparel were branded and sold under the label SST. Margaret. In the sass’s, M&S makes strategic plans toward international expansion. In the sass’s M held position as Auk’s most successful, well known and profitable companies. M&S took a sudden and unexpected turn for the worse and Its profit share fell down to as much as 2/3. This fall would take several years to recover from and required a change In strategic management.
In an attempt to obtain a cutting edge, M&S created a new department dedicated to new opportunities such as the food sector and the financial services sector. By 2002, the company changed its strategy of using primarily British suppliers and began outsourcing overseas. Due to uncertain competition In the market, the key focus on strategy became obsolete and caused a decline in the M&S in relations to its customers. Under new management and restructuring, a plan was established to position M&S back to the center of the market.
Currently, all of M&S’s business strategies are geared towards recuperating and take action if necessary. M has regained a good position In the market by providing a market for competition when dealing with suppliers offering designer ND exclusive brands and as well as those offering lower quality merchandise. By 2006, M had recovered market share however it was short-lived. By 2007, profits for exceeded the El billion threshold for the first time In many years. Unfortunately victory was short lived as the economic recession began in 2008 and has been waning ever since. 1. 2 Business Situation When a company with the prestige and reputation, like that of M, loses its position In the market after such a long period as a leader, the obvious question would be, what went wrong? How could have such a decline be avoided? It would Interesting to note that the decline of M began when the Marks and Skiff family no longer had control over leadership of company.
Some of the main issues that were identified by customers and staff can be summarized as: M had become complacent and relied on their pre-established reputation With globalization, the dependence on the I-J based suppliers became a disadvantage for Change in quality structure costs were gradually Increasing Ana Tell Day ten customers, contradicting tenet “value for money’ initiative. Failure to keep up with the fashion trends hurt the looting sector . In an attempt to obtain a cutting edge, M&S created a new department dedicated to new opportunities such as the food sector and the financial services sector.
By 2002, the company changed its strategy of using primarily British suppliers and began outsourcing overseas. At the moment, all of M&S strategies are aimed at recuperating and act in response. The major threat for M&S is determined by whether or not they can maintain their competitive advantage and hold its position in a highly competitive market. 2. Business Strategy Analysis 2. 1 Initial Strategy The early success of M & S can be directly linked to having a clear intended strategy to create a strong representation of quality and maintain it.
This cognizant strategy was directly linked with Simon Marks’ management style, as he was known for his personal control over the business and his attention to details M&S’ core competences were the brand strength, close working relationship with suppliers and great customer services . M & S challenge required for a close working environment with suppliers to maintain a strict level of quality control and to provide high levels of customer services Unfortunately with unstable competition in the market these key elements of strategy became archaic and caused a rapid decline in the success of M & S at holding its customer base.
Another factor was the company’s refusal until 2001 to accept any credit cards except its own charged. M&S came to the realization that its management approach was outdated and so decided on a restructuring program as its main strategy. 2. 2 New Management Restructuring Strategy In an attempt to turn sales around and under new MGM, Peter Salisbury, several ranges were revamped and M&S began to use marketing data to assess their customer needs. Previous to this all stores carried the exact lines and stock regardless of location. When sales did not pick up as anticipated, Salisbury resigned and replaced with Roger Holmes.
Once again procedures and strategy was changed. It was during this time that M&S acquired a contract for a clothing line called Per Nun range, designed by George Davies, this proved to be a successful union. Stock and share prices improved but not dramatically. Once again, management changed and the new CEO, Stuart Rose. Stuart Rose recognized key areas that needed immediate focus, the most relevant are; the immediate need to improve stock control to fugue out why M&S was so successful o begin with and where the complacency lies With clothing, there needed to be three distinct price and quality brands; good, better, best.
This was intended to give market position and customer appeal. Emphasis on in-house solutions versus relying on consultants to assess company threats and issues. The restructuring strategy was to position M&S and apply a differentiation strategy to attempt to rebuild the confidence once had in M&S. There Is also ten Intention to Doormen tenet market ease Day along towards a larger age roof, as seen by the campaigns featuring young celebrities and models such as Twiggy.
All these efforts proved to be move towards recovery for M&S as 2007/2008 proved to yield lucrative pretax profits however in 2008, recession hit the economy quite quickly. 3. Conclusion 3. 1 M&S is a highly respected company with humble beginnings. It became successful by its vision of more value for your money but over the years, the quality and service has suffered. Globalization has caused the market to be highly competitive and flexibility needed to be taken into act. The failure to do this has caused M&S to lose TTS competitive advantage over its competitors.
The use of only British suppliers and vendors left M&S at a disadvantage to offer their customers competitive prices and quality. 3. 2 In addition, changes in management without proper implementation and loss of focus has landed M&S in a position where it must defend its position. M&S has attempted to write its wrongs by implementing new strategies to attempt to regain its position in the Market however, M&S is operating under a defense strategy at the moment. This could leave the company in a vulnerable position against its monitors since they will be keep up with the trends and not the ones setting the trends. . 3 Another major problem that M&S may be faced with is the challenge to be able to sustain their present core competency. M&S will have to sustain their cost effectiveness and their marketing to keep the feel good factor of shopping with M&S. The challenge will be to keep the competitive advantage and hold a distinctive position in a competitive market. It is clear to see that the strategy taken by M&S has written its rocky course and will prove to play a significant role in the success of, or lack there of, of M&S.
M&S’s biggest challenge will lie on how to keep grip on what has worked for them in the past and what has been its downfall. 4. Recommendations 4. 1 An option for M&S is to analyze and reassess their earlier success and attempt to utilize the approach of building an agreement with major suppliers and distributors. M&S should construct their successful marketing campaign to uphold their reputation and continue to improve their relationship with its core customers. Communication throughout should be a priority. This will allow market share to grown through allegiance and cooperation of all involved.
That being said, strategies re the basis of all business operations but in a constantly changing market, M&S must be flexible to change and should allow itself not to become complacent once again. M&S should be careful to observe market trends and react accordingly. 4. 2 M&S should look to keep the feel good feeling of shopping with M&S. This can be accomplished by keeping the design of its stores trendy and the fashion trends up to date. This will ensure that customer loyalty stays with M&S and don’t resort to purchasing with lower quality/cost retailers. It should address segmentation issues Ana reassess can market accordingly. Dressed 4. 3 Lack AT Transliteration In products need s to De Improve the customer service and shopping experience by investing in the stores and focus on areas like customer relations, stock accessibility. These practices paired with the need for M&S to set the trends instead of simply chasing them. This will ensure they can fight off threats of competition. In order to avoid becoming complacent with its status, M&S will need to constantly review and if necessary revamp their strategy to keep up with a dynamic and changing market. The only way to avoid the same fate is to keep a close eye on consumer trends.