Marks and Spencer Internal and External Analysis

Strategic Management

Assignment 1 due 10/12/2013

Produced by Kenneth Maguire (1123930).

James Workman 1107604

Introduction

This report analysis’s M&S from an external and internal prospective. Externally, Porters 5 forces analyses current and future trends affecting the attractiveness of a competitive arena in which M&S operate. Internally, analysis of resources and competencies using the VRIN framework will highlight competitive advantages that M&S has.

External Analysis

M&S are a plc operating in the general retailers sector of the stock market. Currently this sector has risen from 1900 to over 2700 over the last year (Share prices, 2013). Appendix 1. M&S competition in this sector is for non- food items, home and apparel. M&S compete with companies in the food and drug retailers sector. This sector has risen from 4100 to 4600 over the last year (Share prices, 2013). Appendix 2. Because M&S compete in two sectors, competitors from both are classified as competing in a competitive arena. Finlay (2000).

Growth in total retail (SAS, 2013) is highlighted in Appendix 3.

Own sector M&S peer report Appendix 5 (Bureau van Dijk, 2013).

Food and Drugs sector Tesco peer report Appendix 6 (Bureau van Dijk, 2013).

John Lewis financial figures 2013 Appendix 7 (Key Note, 2013).

Asda financial figures 2013 Appendix 8 (Key Note, 2013).

Online Retail UK to 2012 Appendix 9 Marketline (2013, P. 8).

From the Fame, Key Note and Marketline reports we can see the competitors in terms of Sales, profit, profit margin % and number of employees from the two sectors combined. The peer comparison charts show that the companies that sell predominantly groceries have low profit margins indicating that price competition in this section of the market is higher than in companies selling general merchandise who have higher profit margins.

Retail is expected to grow 1.8% to £300.7 billion in 2013, (SAS, 2013). Food growth 2.4%,...