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H&M

Internal and External Environments of H&M

Thanh Phan

Business Department

MAN 4602: International Business

Professor: Diana Bank Weinberg

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H&M

Hennes & Mauritz (H&M)

H & M is a global fashion retail company for clothing and accessories. Erling Persson

started H & M in 1947 in Sweden. Its vision is to serve as fast and affordable fashion for men,

women, and children. H & M has been well known as its second-largest company worldwide for

over seventy years. Moreover, the company has launched eight brands VIZ., H&M, WEEKDAY,

COS, H&M HOME, ARKETM & OTHER STORE, WEEKDAY, MINKL, and AFOUND. Its

mission is to " offer its customers fashion and quality for the best price."

The retail business is now one of the most promising growth in globalization. Most of the

retail is now transition to online and e-commerce platforms. Hence, H&M takes advantage of the

second-largest company worldwide by offering its clients the most affordable and fashionable

clothes. The SWOT analysis of H&M Company about Strengths, Weaknesses, Opportunities,

Threats.

 Strengths

1. H & M is one of a solid brand value worldwide. It is a global reliable, well-known

name. We can see David Beckham, Madonna, and the crown princess of Sweden are

often wearing. 

2. High customers rated brand because the successful strategies have connected the

purchaser, young purchaser particularly. It is one of the biggest strengths that H&M

has loyal customers.

3. Stable financials is another strength in which H&M has steadily rising sales, and it

has maintained continuous growth.

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H&M

4. Affordability costs and high-value products are some of the most valuable

propositions. 

 Opportunities

1. Online stores are increasing worldwide in which H&M understand and know its

advantage of young customers and internet advent. 

2. The market presence globally in which H&M has launched its online store all around

the world. 

3. Increased demand for clothing products. With the increase in income of young people

lately, especially in China and India, which two big markets of H&M; hence, the

increasing potential of young people is purchasing the products.

 Weaknesses

1. The design might not stand out because of quick fashion. H&M can be in racing with

fast design clothing companies due to the easiness of replicas in style.

2. Mass products may cause unsold inventory—the unpredictable quantity over one

product which not in trend will have torn H&M down.

3. It is a challenge for H&M to keep changing trends promptly. The changes in style and

designs have significant pressure on H&M, with needed a very efficient supply chain

to respond quickly to shifts in fashion. 

4. The mall strategy is continually falling. With the increase of online store, mall-based

fashion store has been falling behind on sales and people visits.

5. Backlash over insensitive promotions, H&M has to keep it up with trends; therefore,

the promotion has kept it up to date with all the stores in different geographies.

 Threats
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H&M

1. Changing global dynamics, H&M will have to be intensively cautious with changing

its stores' political and legal environment in different countries.

2. Threats from competitors, H&M needs to improve its technology at lowers cost. It

has to be at the top of continuously providing better customer service to customers.

3. H&M's constant requirement for innovation in line with the most advanced trends,

H&M can connect with local designers to keep its movements to local customers in

each country.

The PESTLE or PEST will discuss the external influencers toward political, economic, social,

technological, legal, and environmental. 

 Political: Changing leaders in the USA, Europe, and Asia have changed the present

movement toward the flow of products. De-Globalization surge across the globe, with the

trading war, between The US and China has affected it high taxing. It has caused the

trade restriction. Overall, people are more and more centric on their nation.

 Social: social media is emerging as a storefront for fashion retailers. It is one of the most

effective in cost. Moreover, it creates communication between the company and clients to

keep it up to date with trends and customer feedback. Hence, H&M can know how

customers are changing their choices of products.

 Legal: H&M has to face the challenge that some countries have stricter norms and

regulations for foreign companies in other countries.

 Economic

1. There will be shifts in tax regime or Modified tax systems with a tax trade between

The US and China, moreover, the new tax system in India. 

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H&M

2. Changing economies of scale is also shifting from one developing country to another

geography. It can make a difference in number toward profit.

3. Changing labor laws is the difference from one country to another country. Therefore,

H&M will have to explore and understand the market condition to have the right

segments or services.

 Technological

1. Innovative technologies such as data analytics and AI will increase the efficiency of

H&M to predict accurate trends, forecast inventory, and communicate effectively

with customers.

2. The increasing importance of online channels will help H&M commit and develop a

better connection with customers.

 Environmental

1. Climatic conditions influencing apparel choices will affect the customer's options to

specific materials in different geographic.

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References