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International retailing and marketing - Essay Example

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Dawson et al (2000: 343) remarked that "operating internationally for the major retailers had become, by early in the twenty-first century, the standard situation and is now not so much a key success factor as a key non-failure factor for large retailers." This report aims to determine whether indeed going global contributed to the success of prominent retailer Marks and Spencer…
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Download file to see previous pages A review of literature has provided a consistent definition of the term International Retailing which is "the operation, by a single firm, of shops, or other forms of retail distribution, in more than one country" (Findlaey and Sparks, 2000: p. 40; Alexander, 1997:p. 27). This definition encompasses several types of company schemes such as the Body Shop and Bally which operates their own stores and franchise arrangements; GIB, Vendex, Aeon and Ahold which operate separate chains of stores internationally; and the IKEA, Sogo and Toys R Us which operate a single chain.
Every business move must be thoroughly studied before application and given the complex nature of retailing in an international setting, it would be prudent to conduct a study aiming to determine the necessary scheme to be adapted by the interested company. There are many methods for determining business environment such as the Political, Economic, Social and Technological (PEST) analysis which is mainly concerned on the operating environment and the Strengths, Weaknesses, Opportunities and Threats (SWOT) analysis which considers also other competitors already present in the market. These analyses shall be used to determine strategies for a successful entry scheme. Retail companies can opt to establish presence by modes such as direct establishment of stores or franchising. Since any business is an on-going process of learning and growing, many retail companies find it necessary to incorporate strategic factors in their business plan along the way.
III. Marks and Spencer: A Background
Marks and Spencer PLC is a companyr, established in the late 1800s by a partnership and is currently one of UK's leading retailer of clothing, food, home products and technology. Last 2008, Tthe company employs more than 65,000 people with 339 stores in the UK and 155 stores franchised in 30 countries found in Europe and Asia. It is also involved in financial services such as loans, savings and credit cards. The company made news in 1998 as it posted a pre-tax profit of over than 1.15 billion pounds sterling but later suffered a downfall for several years until 2003. (MarksandSpencer, 2009a)
The company operates primarily by producing high quality products carried by a recognized and valued brand name. Products are affordable but not necessarily cheap. The prevailing philosophy for advertising was only by word of mouth which was very powerful as many customers are likely to purchase in the shop favoured by those close to them. This method was also very cost effective as there was no need for expensive adverts. From its inception until 1998, it had the policy of sourcing only from British suppliers and thus endeared them to the British public.
Marks and Spencer officially adapted and carried the brand 'St. Michaels' for middle age and young apparel distribution in its stores. Stores are mainly located centrally in capital cities and important venues so that critical mass (number or buyers) can be realized. M&S is in possession of several prime holdings around the globe and is using it to establish presence.
The company experimented in internationalisation by exporting its 'St. Michael' line to ...Download file to see next pagesRead More
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