Marks & Spencer Overseas Expansion

Hello Everyone,

I thought i would throw some business news into the mix today as i am in serious revision mode for my final exam tomorrow evening. I was keen on writing this post a few weeks ago when the story was pretty new but it was something i thought was quite relevant to my Strategy and Change management unit for my course. Marks and Spencer's are planning an overseas expansion which I am intrigued to read more about. A few years ago Tesco ventured over to expand overseas and unfortunately they did not survive so this makes me question what Marks and Spencer have that make them confident in this expansion.

M&S plans to expand its overseas profits by 40pc over three years with the opening of 250 stores, including 20 food outlets in Paris.

Marks & Spencer intends to open 250 new stores outside the UK in the next three years as part of significant global expansion plans. Marc Bolland, chief executive, revealed that the high street retailer is looking to grow its international sales by 25pc and profits by as much as 40pc. Marks & Spencer Lingerie & Beauty has already opened at two locations in Saudi Arabia, with 10 further stores planned in the next two years. M&S has also earmarked 20 sites in India for the lingerie and beauty concept, which is smaller than the company’s traditional stores. In total, M&S wants to have 100 stores in India by 2016.

The company has 455 stores around the world, compared with 337 when Mr Bolland took over in 2010, meaning he will have more than doubled its footprint overseas. Mr Bolland told investors and analysts at a presentation in Paris on Tuesday that fresh food, beauty and lingerie offered “great opportunities” for international expansion. Steve Rowe, executive director for food, said: “Britishness is as saleable as ever in any part of the world.”

However, while M&S ramps up openings in western Europe, India and the Middle East, it is considering its options in China, which is on course to become one of the biggest retail markets in the world. Other British retailers have already been defeated in their bid to expand in China, and Mr Bolland admitted that M&S can’t succeed in isolation and will seek help from a local partner. Tesco has already sold a majority stake in its Chinese business, while DIY retailer Kingfisher, the owner of B&Q, said it would look to form a joint venture.

M&S’s overseas expansion comes as it continues to struggle in its traditional UK market. Annual profits for M&S were recently overtaken for the first time by Next, the high street clothing retailer. What do you think about their oversea expansion plans? Do you think they will strive and dominate unlike Tesco?