With Reference to Your Own Research?
With reference to your own research to what extent do you think that acting in a socially responsible way is now essential for businesses? Social responsible allows business to create a positive relationship with the community and also then environment within their operation. Companies that use socially responsible are Marks and Spencer. They have done this by creating an operation call Plan A where they are able to generate ? 85 million from just reducing costs. Saving this amount of money they are given the opportunity to expand the M&S brand, this is one of their main objectives where they want to have a M&S store within a 30 minutes radius of each customer. With M&S saving ? 185 million they have been able to a positive relationship with the community that they are in.
What they have also done is that they have been cleaning out the community’s lakes and rivers this is very good as they will be looking to show that they are caring about the environment, being social responsible is a very good marketing strategy as they will be gaining publicity, and this will lead to more people becoming more aware that M&S are looking after the environment and people will be willing to support the idea. They will be doing this through shopping at M&S. The disadvantages of social responsible for companies such as M&S are that they will have lost an opportunity cost as they have been able to save ? 85 million they will have to choose whether they want to continue supporting the local community or increase their market share. As M&S want to increase their market share they will not be able miss opportunities like this, but they have to have a good relationship with the local community. M&S are now supporting fair trade and organic food, this very risky as this is asking customer whether they want to pay more for food or go to one of M&S’s competitors and start shopping with them as both fair trade and organic will cost more than any other food.
By being social responsible M&S will have problems going in to emerging markets such as Brazil an d China. With China being able to take 600 million people out of poverty M&S will have lost the perfect chance to exploit that. Brazil have got big events happening in the next 3 years with the world cup in 2014 and the Rio Olympics in 2016, investing a new store within this area will help them increase both market size and also brand awareness M&S operating profits have fallen . by 1. 8%, this is not good for companies such s M&S trying to become more social responsible, with this decrease in profits they will have less money to spend on their Plan A project. With employees being told that they will have to clean up rivers and lakes M&S will have to be able to motivate their workers enough, this could cost M&S a large amount of money just to get employees to do this. One of social responsibility is to look after employees, making them clean a lake or rivers could make them feel as if they are not being used to their full potential and could result in them taking industrial action.
M&S have been very good at reducing their amount of carbon emission being released and this is shown as they have been able to save 28% more energy compared to the amount of energy used in 2007. Being social responsible can help many companies such as M&S financially as they will not need to pay so much for their pollution tax this can result in them being able to increase their profit margin and helping them supports the community more.
Problems that M&S can also face is that some of their customers may not believe that they will be helping their community and may think that they are just a marketing gimmick, this is important that M&S show those people that they are really helping the community and to do this they could publish the amount of money they have got and show them what they want to spend it on. Overall social responsibility is now essential for business to do as they can help the stores local community and business. With them saving ? 85 million they have got to choose whether they want to exercuite their Plan A effectively or try and open more M&S stores within developing countries such as Brazil and China. Especially where there are two of the worlds’s biggest events happening in Brazil within 2 years of each other. To make full use of their Plan A M&S will have to plan and exercuite it well enough that the community can feel like as if they have made a huge impact within their community. But with cost reduction occurring their profit will increase.