Situation actuelle des entreprises

These operating tenets have gained M&S the support of British producers,

consumers, and workers. The sixth largest employer in British manufacturing, the

textile industry, with over 354,000 workers, owes a large part of its existence to M&S

(The Economist 1999c). M&S has encouraged British textile manufacturers to keep

factories at home, which led to a better check on quality and more flexibility in

manufacturing and distribution (The Economist 1999c). The British have responded

with affection. A British writer described M&S as "quintessential British institution,

woven into the fabric of our national life, as firmly lodged in our psyches as

furniture in the front room" (Financial Times 1999, p. 10).

CURRENT BUSINESS SITUATION

Using the business model described above, M&S had achieved impressive growth

rates and market shares in many of its business segments. By 1994, the firm had

18% of the UK retail market, 33% of women’s undergarment market, and 20% of

men’s suit market (De Nardi-Cole 1998). The company has 40% of the nation’s

underwear market and 14% of the clothing market - only retailer in Europe to have

double-digit market share (Financial Times 1999). M&S food market share has

been around 4.3% (M&S Press Releases 1999). The impressive market shares have

gained M&S the reputation of a leading retailer in the United Kingdom.

The euphoria, however, did not last as M&S caught investors and business

spectators off guard. In 1998, the company’s stock fell 34% (Business Week 1998).

Pretax profits fell by as much as 41% (to $1.09 billion) and market share declined,

for the first time in years, by almost 1% (The Economist 1999a). In May 1999, the

company reported full year profits of L630 million, a 50% fall from 1997-1998

(Financial Times 1999). Warburg D

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