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Jackson and Sparks (2002)Management > Crisis Management > Lectures > Independent Research > Jackson and Sparks > OS > M&S > Causes of failure - external
Causes of Failure - External factorsExternal factors include a dramatic change in the competitive landscape, where firms such as Next, Zara and Mango beat M&S on quality and price. Most of them were international retailers, foreign to the UK, and they brought in new methods. Retailers such as Primark and Peacock targeted the very cost-conscious market and Tesco’s “finest” range stole much of M&S’s share of the food market. These firms were more in touch with customers and did more advertising, meaning that M&S’s alternative approaches to business had become a liability. It took a while for M&S bosses to accept changes, such as the introduction of credit card facilities, and when they did, it took too long – nine months in fact. In addition, the store layout had not changed in 20 years, whereas competitors changed theirs every week. M&S’s persistence of “buy British” became a liability when competitors started outsourcing in China and the Pacific Rim. M&S already had access to these areas, but did not take advantage of the opportunities. M&S had strong principles, but these were making the firm non-competitive. They cut suppliers in the UK, but trade unions, the media and suppliers created a public outcry, even though this is what all the other competitors were doing. Computerised systems for stock control were being used by competitors, but M&S stuck with paperwork.
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