PESTLE Analysis of H&M: Impact of External Factors on Business

ENTERPRISE AND INNOVATION
Introduction
PESTLE Analysis is that tool which is used to determine the external forces and their impacts on the organization. It helps in analysing
the political, economic, social, technological, environmental and legal factors that can affect the business. Here is the analysation of
these factors for H&M.
Political factors
Most of the production of the company is taking
place in the turkey, Lebanon and Egypt. The
political stability of these countries is not good,
large number of political fluctuations takes place
in these countries. Therefore, the company has to
face many fluctuations in their trade due to the
changing policies of the government. The
organization is facing the brexit effect as well.
Company is focusing on all the policies of
government in order to have a healthy
relationship with them.
Economic factors
The firm performing its operations in many
countries. The corporate tax policies of these
countries are different and the company has to
align their business according to that policies.
Otherwise, it affects the level of economy in that
particular country. In terms of economic factors,
H&M does not clad any crucial effect. As the
economy around the world is improving and
making people able to spend more of luxurious
products.
Social factors
The public is highly influenced by the social
media in terms of fashion. The influencers
create an urge in the mind of the people. Due to
this, the public is more preferring designer
clothes. Thus, the demand for the fashionable
clothes in increasing. The firm getting immense
benefits due to this. The firm is completely
focusing on buying behaviour in order to trace
customers for a long period and this enables in
maintaining the social factors for the
organization.
Technological factors
The fast growing technology results in creating
a large base of consumer for the company. As
the customers more prefer online shopping
rather than going on stores, H&M has a good set
up on the online platform. Large number of
transactions are taking place between the
customers and the firm through this digital
platform. The advancement of technology
helping firm in adding more innovation to their
production.
Legal factors
H&M is a multinational brand and the operations are
taking place at the global level. The rules and
regulation of each nation is different. The firm
operates many franchises due to these the intellectual
property right has become an issue for the
organization. Many designers stole the concept of the
artist and use it as their original concept. This has
been considered as illegal. The firm is facing this
situation under legal factors.
Enviourmental factors
Textile industries has been considered as one
of the polluting industries. The production
process of these industries creates lots of
pollution in the environment. Due to this the
company is facing some obligations from the
public. H&M is performing their CSR in order
to bear up the obligations for making
environment polluted. The organization is
using the concept of sustainability in order to
maintain environment.
CONCLUSION
The PESTLE Analysis helps in knowing the external impacts over the business and provides a guidance in terms of handling those impacts. H&M is handling
all these factors in effective manner.
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