M&S Failure in Internationalisation
BACKGROUND
Marks & Spencer ( M&S) , popularly known as Marks & Sparks , one of the leading retailers in UK began internationalizing in early 70s with formal store based operations in Canada and so on and so forth. However , On 29 March 2001, Marks and Spencer (M&S) announced that it was to sell its Brooks Brothers clothing chain (USA and Japan) and Kings supermarkets (USA) businesses, and turn its company-owned stores in Hong Kong into a franchise. In addition, it was going to close most of its company-owned continental European stores, viewing them as ‘distractions’ in its quest to restore its fortunes . A wave of protests across continental Europe about the closures and job losses was the result.
CURRENT SCENARIO
M&S decided to shut down or sell any assets which get in their way of the UK recovery.The adopted a strategy of total focus on UK retail,improving returns to the shareholders and increasing the leverage and earning potential of the business.However, around a decade after their exits and European sell off , M&S have started intenationalising again with opening up of stores in China,India,Dubai and also planning to buy back the European stores.
PROBLEM STATEMENT / AREA OF OPPORTUNITY DEFINED
To find the reasons why M&S failed initially in its internationalization process and how it can succeed in spreading the brand overseas now.
Basically performing a GAP analysis , PESTEL analysis combined with the reasons for failure to recommend the implementation strategy for M&S to go international.
GAP ANALYSIS
STRATEGIC OBJECTIVE | CURRENT SCENARIO | ACTION PLAN | To transform M&S from being a traditional british retailer to a modern international & multi channel retailer | Appointed Marc Boland as the new CEO & devised a strategy to target Asian,Russian& Gulf markets | Devise a more committed & standard implementation strategy by
Marks & Spencer ( M&S) , popularly known as Marks & Sparks , one of the leading retailers in UK began internationalizing in early 70s with formal store based operations in Canada and so on and so forth. However , On 29 March 2001, Marks and Spencer (M&S) announced that it was to sell its Brooks Brothers clothing chain (USA and Japan) and Kings supermarkets (USA) businesses, and turn its company-owned stores in Hong Kong into a franchise. In addition, it was going to close most of its company-owned continental European stores, viewing them as ‘distractions’ in its quest to restore its fortunes . A wave of protests across continental Europe about the closures and job losses was the result.
CURRENT SCENARIO
M&S decided to shut down or sell any assets which get in their way of the UK recovery.The adopted a strategy of total focus on UK retail,improving returns to the shareholders and increasing the leverage and earning potential of the business.However, around a decade after their exits and European sell off , M&S have started intenationalising again with opening up of stores in China,India,Dubai and also planning to buy back the European stores.
PROBLEM STATEMENT / AREA OF OPPORTUNITY DEFINED
To find the reasons why M&S failed initially in its internationalization process and how it can succeed in spreading the brand overseas now.
Basically performing a GAP analysis , PESTEL analysis combined with the reasons for failure to recommend the implementation strategy for M&S to go international.
GAP ANALYSIS
STRATEGIC OBJECTIVE | CURRENT SCENARIO | ACTION PLAN | To transform M&S from being a traditional british retailer to a modern international & multi channel retailer | Appointed Marc Boland as the new CEO & devised a strategy to target Asian,Russian& Gulf markets | Devise a more committed & standard implementation strategy by