Marks and spencers as an international retailer

Marks and spencers as an international retailerMarks and Spencer, known as M S, is one of the biggest retailers in the world. It has al near 150 stores in 30 countries, including 130 franchises operating across the globe. Though it is very popular for its clothing chains in the unite Kingdom, M S is also known for its multi-million pound food industry. M S also apportion home furnishings, footwear and gifts early(a) than clothing and food. In the get together Kingdom alone it has 450 stores and down the stairs the authentication St. Michael, it has a chain of 294 stores. Almost all the political partys overseas branches atomic number 18 locally franchised. M S owns the United States of Americas Brooks Brothers and King Super Markets. To meet the demands of the clients the phoner gets facilitated by Direct Mail. The associations core objectives of meeting the node expectation and giving consumers easier and better access to a wide list of products. The financial servic es for the customers are provided by the groups financial services which comprise of the unit trust management, life insurances etc.M S in recent years suffered a succession of adversities, both at home and abroad. The sales of the company perplex dropped. The market capitalization and stock prices reduced substantially and the overseas profits have tremendously declined. As a result the company was forced to form a market department in January 1999 and become more proactive and market driven. M S followed a very simple trade philosophy for a very long time. That is to produce high quality products under a appreciate brand and advertise through the word-of-mouth. But in the recent past, this advertising scheme has come under criticism as the company started losing its competitive touch. The challenge now is to develop a good merchandising strategy and emerge from the slump to reposition M S as a fierce orbiculate competitor in the international arena.Internationalization S trategy of M SThe internationalisation of the M S began in the early 1940s. It is beca procedure the company started to feel that the house servant market has been saturated and the enlargement has to come from abroad. foreign most of the firms, M S began to export its products on the brand name St. Michael as a commission to test the waters. It has been in(predicate) and the company was exporting about $1,146,000 worth of products by 1955. Externally, the members of a local craunch party were suggesting nationalizing the booster cable domestic retailers.Sooner as a tool of diversification, some international franchising relationships were formed. This franchising allowed the company to achieve global presence with minimum political and economic risks. As the relations of the company grew with other global countries, MS choose to invest reign overly (FDI).MS uses various types of foreign entry around the world. But mostly the company believes in opening its own stores in m ajor economies. It has its own stores in Belgium, Canada, France, Germany, Spain and Netherlands and franchises in Cyprus, Israel, Bermuda, etc. when forming international alliances it often prefers an experienced retailer in that particular rural area. Its first articulate venture was established in Spain as it felt the cultural distance and market power of its co company will help to mitigate the political climate and behaviour of the company. Its international strategies in Spain numbered successful results which helped it to gain popularity in the global markets. Through franchising, its approach was mostly top-down. That is it has a centralised management which could non be better off in various marketing situations. Hence it was forced to change its internationalization strategies through foreign direct investment. Due to this there is a forced change in its technology, cultural behaviouring and regional promoting aspects. MS started to open stores in America, Far East an d Europe. In different parts it has reasonably different operational strategies depending upon the host countries values. In America it used acquisitions with Brook Brothers (clothing company), in Europe it has its direct stores running and in Far East, some stores were run with franchise and others through direct investment.Following a wide range of strategy reviews of its business, board of MS announced in 2001 significant changes to its strategies. The important decisions in its strategy areExpansion in growth of productive products.Acceleration of store renewal weapons platformBeing close to the customerMore intensive use of spaceRelease value from fractional the property portfolioCost cutting.MS has a wide range of returns on food products and has earned customer trust. So it decided to invest its major investment in food, home and beauty products. Its other intent was to accelerate the renewal of store renewal. Under this, it planned to refurbish more stores faster at the pass up cost. It also reallocated to higher growth product areas to maximise returns per sqft. Apart from these strategic changes, it uses direct investment in global sectors which gained them a competitive return.Factors affecting MS strategy in that location are various factors which has a certain impact on the MS internationalization strategy. Of them, technology has been one of the factor in which the company was forced to change its strategy in various countries. But broadly speaking, in this fast develop technological world, technology used by Ms is been available where ever it opened its stores. A handsome adjustment to the technical functioning of a store is enough for the company to have its strategy working. The most important factor that has its resemblance in the formulation of internationalization strategy is geography and distance.As the marketing strategy of MS is universal, however it does not mean that it uses similar strategies in all parts of the world. There is a large effect of globalisation to the formulation of internationalization strategies. Consumers from various countries are different referable to varying culture, economic development, and income level and so on. So in certain cases MS does not use its centralised operating strategies instead it combines with some other company through mergers but has its own standards running. This initial phenomenon of outsourcing and then after some recognition opening its own store had a significant upwardly success in MS organization.As marks and spencer is generally known for its clothing and food products, the neighbourhood of the company is very important. As MS runs its stores in different countries, transportation of the products has to be done in a prcised manner such that there is no shortage. So in order to keep down this transportation and time differences, MS has its own outlets in specific countries. These outlets have immediate access to the try of products whenever require d. There are certain situations where it cannot have its own outlets due to some government policies and other factors. In these cases, marks and spencer uses its internationalization strategy of franchising. So that it has its own functionality running by other company. All these have significant impacts in the brand distribution globally.Apart from these, government trade policies also play a part in the strategy formulation. Given the growing links among nations, it is very difficult to consider domestic policy without considering international repercussions. In the case of formulating its strategy in US, bilateral negotiations are carried out top wide range of products, services and investments. Such a policy should pursue the government to facilitate competitiveness and encourage collaboration among companies in the areas of goods and process technologies. MS is an UK company where the marketing conditions have to be emphasised by the government and the product is socially a ccepted. Also great emphasis is placed on capability by government policies. Where as in US and Far East countries, they regard individualism and the promotional appeals should be relevant to the individual to incorporate lower power distance within the market.Also the main(prenominal) advantage of Marks and Spencer government policy is that it had an opportunity of taking advantage of NAFTA (North American Free betray Agreement) in US. It takes advantage of tax under this agreement and is outsourcing its products to Mexico and Canada. It also has an advantage of making economic smell in terms of logistics. The important policy priorities for the tax Policy Action Group (PAG) in the future(a) includeThe Tax Framework for BusinessThe Value Added TaxThe National Insurance ContributionsM S will be benefitted over the above made policies by the government. The idea is to focus on the vigilance and the management of the policy implications in indirect tax, company tax, personnel t ax and customs duty.ConclusionThe courtly wisdom on development of the developed companies like MS has focused on learning from mistakes. The leading MS Company showed that their high risk strategy of acquisition and direct investment can yield successful results backed up with technology, and cultural values. The insights from the study on MS suggest that overseas expansion is related to the need to improve global competitiveness in order to boost their outsourcing capabilities. No result the distance and differences between the countries, MS has been the successful organization to open its companies in different countries and make them profitable ones. The only important aspect for it is to make a minimum number of changes to the functioning and marketing aspects depending upon the country in which it is operating in. thus from the above analysis it can be understood that the globalization strategy of MS created a new marketing paradigm in its success and also gained superior ad vantage and reputation irrespective of the host country policies and other factors. Hence it is clear from the strategies of an MS company that we give-up the ghost in a truly globalised economy where differences across countries are given little importance in development.