Different Strategies of M&S for UK, Europe, and Canada - Essay Example

Marks and Spencer, Ltd., (M&S) has recorded a consistent pattern of growth in its operations over the long period of its history and more specifically, during 1981-1988. However, the firm faced significant challenges throughout the 80s due to many factors like a poor show of its brand in the Canadian operations as opposed to its other local brands viz., Peoples/D’Alliard’s, failure to reach profitable customers in France, and the need to refurbish stores across the UK for greater customer satisfaction.

Its strategies in the UK revolved around a) supply management b) brand power c) customer orientation and d) empowerment of employees. As it moved into the 90s, M&S needed to overcome the challenges identified above (Montgomery, 1994, HBS Case study # 9-391-089). Tools Value chain concept: The case highlights M&S' emphasis on the ‘value chain’ concept as a strategy for economizing on operations, maintaining long-term supplier/buyer relations, and quality control. Popularized by Porter as a competitive advantage tool, the value chain concept dovetails the different operations of a buyer and his supplier(s) to achieve maximum efficiencies for cost control for both parties (Porter, 2004, Ch.2, pp.33-61 & 107).

Using this strategy, M&S attained a strong reputation and position in the UK market, where its net profit (your last name) 2 margin was around 10 to 11% in the 80s. In contrast, its overseas operations yielded just around 6% net profit due to external factors like tariffs and local competition. Differentiation: The case highlights the differences between the French, Canadian, and UK markets. France is a high-margin market and although the few customers who accessed M&S products are well satisfied, many others, especially the younger generation, preferred other brands.

In the absence of aggressive marketing, M&S faced indifferent ‘customer perception’. The Canadian market is characterized by relatively low margins and a preference for established local brands. In both France and Canada, M&S could attract mostly not-so-young customers. Hence, there is a need for offering differentiated and well-publicized products for different market segments in France and Canada, where competitive advantage has to be gained by product differentiation since economizing on costs has only limited scope and appeal.

Redesigning its strategy for global operations, to take care of local preferences, local competition, and local conditions. Whether to continue M&S and Peoples brands in the Canadian market. Revamping/modernizing its stores across the UK to sustain growth momentum and at the same time, maintain market share and profitability. Benchmark companies Li & Fung, IKEA, and Wal-Mart can be seen as benchmark companies that faced similar issues. (your last name) 3 Recommendation M&S has to adopt different strategies for its three markets the UK, Europe, and Canada.

Its plans for revamping the stores across the UK coupled with the time-tested value chain approach for economizing costs are appropriate. For the European market, it should deploy its resources in a more focused way on brand building and promotion to attract the younger generation – this may involve fashion products as additions to the existing offerings that are appreciated by older customers. Finally, in the Canadian market, there is a serious case for closing down M&S/Peoples brands because of the adverse ‘profit to sales ratio’ over a long time. The resources generated by this step can be better utilized for further strengthening D’Alliard’s line in Canada and M&S, in UK and France.