Business strategy is the means by which firm’s plans to achieve its goals and objectives. It can also be termed as organization long-term planning. The strategy covers periods between 3-5 years and sometimes longer. Businesses use two major types of strategy, general or generic and competitive strategies. The overall strategy involves strategies of growth, globalization and retrenchment. The competitive advantage includes low pricing, product and customer differentiation. We will look at the business strategy used by Marks and Spenser (Cole, 1997). The company is a British multinational located at Westminster London and specializes in clothes and luxurious food products.
The alternative strategies relating to substantive growth, limited growth or retrenchment for marks and Spenser.
Marks and Spenser alternative for the substantive growth can take the following strategies, horizontal integration, related diversification, vertical integration and unrelated diversification.
Horizontal and vertical integration
In the horizontal integration, the company product range is from a wide clientele. That is they sell product either clothing or luxurious foods from different manufacturers. These give them the edge since the products they offer a variety for the customers to choose from, and hence they can shop less than one roof (Cole, 1997). In the vertical integration strategy, the firm will deal substantial with products from a single supplier and M&S gets the exclusive rights to deal with the product and its supply to the market. This is necessary when the company aim is to serve an identified target market which is exclusive and has the potential to sustain and grow the company substantively. These employ a tar...
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... strategy of cutting cost is planned in the next one or two years by 2016. The target for online shopping that the company estimates to increase by 8 million people is to be achieved by 2020.
The product development phase is characterized by innovation. The M&S employs four strategies;
New products which are new radically or extend to the next product life cycle
Innovation in process which leads to reduced cost and is achieved through learning and experience
Differentiation through marketing strategies, this is a form of innovation driven by the need to create a superior brand (Sadler, 2003).
Organizational changes that reduce cost. The M&S reduced its management levels to reduce the cost.
Retrenchment is remedial actions and is taken at phases of strong competition, inefficiency and economic recession.
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