PESTLE Analysis of H&M: Understanding the External Factors

This report provides a PESTLE analysis of H&M, examining the political, economic, social, technological, legal, and environmental factors affecting the organization. It discusses how H&M has taken advantage of trade policies, the impact of Brexit on sales, the company's efforts to promote gender equality, and its focus on technological advancements. The report also highlights the importance of patent rights and the company's commitment to sustainability. Additionally, it explores the key drivers of change in the industry, including technology development and competition.

BM461 GLOBAL BUSINESS
ENVIRONMENT

TABLE OF CONTENT
MAIN BODY...................................................................................................................................3
PESTLE analyse..........................................................................................................................3
Key driver of change....................................................................................................................4
REFERENCES................................................................................................................................1

MAIN BODY
PESTLE analyse
It is essential for the business to be able to understand and analyse the external factors
which are going to have a lot of impact in the decision making of the organization. The further
report is going to discuss this factor with the help of PESTLE framework to be able to
understand the functioning and plan for the future effectively.
 Political factors
There is a stable power of politics in the country which is why there are not many
changes which are taking place in H&M. The organization has taken advantage of the trade
policies which countries have changed so that the organization will be able to expand themselves
be profitable as well. Major manufacturing of the organization is taking place in Bangladesh
since due to cheap labour and the political factors are in favour of the organization (Grima,
Spiteri and Romānova, 2020).
 Economic factors
Sales of H&M rose by 7% even after Brexit took place in the country. Customers are
purchasing the products and services for bulk which is why the prices of company are also based
on competitive strategies. Labour legislature are also changing which needs to be controlled by
the organization and this factor is not in favour of the company in a lot of ways.
 Social factors
H&M are hiring more women in the organization to give equal chances so that everyone
can showcase their talent in the industry. There are healthy hygienic environment which is being
provide to the employees to work within (H&M PESTEL Analysis, 2020). The pricing of the
products is also upon the lifestyle of the people in which H&M has expanded themselves and the
pricing differs from location to location so that the satisfaction level of the customers can
increase.
 Technological factors
The company has been able to follow the trends and technological changes in the market
since the industry is belonging from the fashion industry. There are going to be higher
performance in the industry if this change can take place effectively.
 Legal factors

There are a lot of patents which H&M will have to take in the market to be able to
operate effectively so that the performance is going to be higher and unique features are going to
be present as well. In 2015H&M lost multi-million pounds to another organization due to this
reason.
 Environmental factors
The aim of H&M is that by 2030 the company will become renewable factors by making
sure that they are reusing old products in the organization. The company is trying their best to
have zero carbon footprints in the environment which is good for the reputation of the
organization.
Key driver of change
 Technology Development
Keep labour at low wages is not a good factor for H&M since they are not skilled and
technological changes can not come in the organization. Technology is going to make the
organization have higher sales and increase the profitability as well.
 Competitors
There is high competition in the market which needs H&M to analyse and take the right
patent rights for their products and services so that they can continue to have competitive
advantage and unique selling point.

REFERENCES
Books and Journals
Grima, S., Spiteri, J. and Romānova, I., 2020. A STEEP framework analysis of the key factors
impacting the use of blockchain technology in the insurance industry. The Geneva Papers on
Risk and Insurance-Issues and Practice. pp.1-28.
Online
H&M PESTEL Analysis. 2020. [Online]. Available through:
<https://businessteacher.org/pestel/hm-pestel.php>.
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