Marks and Spencers

Question 1: Describe all assumptions made and the substructure for such assumptions. Assumption 1: Established brand would be to customer loyalty. Marks and Spencer (M&S) was established in 1884 which represents over a century of business. During this time, they were able to build a time-honored brand and become a leader in their industry. This leadership position may have resulted in some direct of com sendncy on the part of M&S who failed to recognize and appreciate the evolution of customer buying preferences. The innovative consumer is increasingly more demanding and is no longer satisfied with merely the reputation of the brand but also demands better quality, preeminence and cost benefits. Failure to recognize and plan for potential juvenile entrants (e.g. aligning business strategies with the voice of customers), may have resulted in the erosion of their market share. Assumption 2: Producing abroad would overturn convergenceion costs. In an effort to reduce the 30% of product cost associated with labour, M&S decided to canalise manufacturing to China, Cambodia and Bangladesh where labour was expected to be cheaper. M&S assumed that the reduction in labour costs would automatically result in a reduction in the numerate cost of production.

This is assumption failed to account for other factors such as additional costs and lead times associated with shipping to farther distances. M&S may have miss the fact that successful operations in these countries would also exact to be supported by effective labour dealings and understanding of cultural nuances. Assumption 3: Sales narration would provide accurate forecasting. As a result of an brassbound supply chain, M&S was required to place sales orders months in advance of requirement. This would lead to a with child(p) dependence on sales forecasting which is prone to inaccuracies. M&S forecasting techniques predominantly utilized historic data (e.g. stocks and sales from previous years) which... If you want to get a full essay, order it on our website: Orderessay

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