Strategic Management for H&M

STRAETGIC MANAGEMENT

Table of Contents
INTRODUCTION.......................................................................................................................................3
TASK..........................................................................................................................................................3
Organization background information.....................................................................................................3
External environment analysis by using relevant strategic tools..............................................................4
Competitor analysis.................................................................................................................................7
Internal environment analysis by using strategic tools.............................................................................7
H&M strategic choices and future strategic direction..............................................................................9
Strategy selection and justification........................................................................................................10
CONCLUSION.........................................................................................................................................10
RECOMMENDATION.............................................................................................................................10
REFERENCES..........................................................................................................................................11

INTRODUCTION
Strategic management refers to the process of monitoring, evaluation and ongoing
planning that is important for a company to meet their set aims and business objectives. The
current report is based on H&M, is global firm based in Sweden. This study explains external
and internal environment analysis by using suitable strategic tools or models. Furthermore, it
also clarified competitor’s analysis, future strategic direction and strategic choices of company.
In the final part, evaluation of strategy selection and their justification will be discussed along
with suitable recommendations in this report.
TASK
Organization background information
H&M is one of the best and most popular Swedish clothing organizations in the world,
they offer fast fashion cloths at cheaper prices, and it was founded by Erling Persson, in 1947.
Company develop different strategic plan in order to strengthen their brand image, to gain
competitive advantage and to sustain within fashion industry for longer period. Firm is able to
satisfy their target market by offering products according to their preferences and current trend.
Within fashion industry, competition level is high it put pressure on organizations work under
this sector to make changes within their current business practices. In order to gain benefits from
competitive environment, H&M develop relevant and effective strategy. Firm decided to launch
a buy now, pay later services in United State, to avoid retail deadliest mistake. It allow
consumers to keep an product for minimum 30 days before deciding when they want to opt and
keep to pay for specific item in 4 installments. Organization is the first or latest retailer who
launches and develops this strategy to become market leader; it is quite beneficial in term of
increasing profitability and consumer base rather than its competitors. Along with it, to keep
sustainable H&M focus on sustainable strategy (Razzaq & et.al., 2018).
Fashion industry has been recently called out as one of the most environmentally
damaging sectors. By taking strategic decision Hennes & Mauritz, can sustain within market
place in effective manner that is very beneficial for its business growth as well as success. The
reason behind creating this sustainable strategy is the issues being faced by fast fashion such as

chemical use in fashion production. They develop strategy to use only recycled or sustainably
sourced materials in order to keep competitive.
External environment analysis by using relevant strategic tools
PESTEL model-
Political factor-
The main political factor impacting H&M business strategy and practices is restriction on
exports & imports and relocation of production as it impact negatively on firm sustainable
strategy (Grumiller & Raza, 2019). It create barrier to collection raw material from different
nations or place for producing sustainable product for consumers. Brexit is the main reason
behind import and export restriction between UK and EU. It can be considered as threat for
organization that affects productivity and sales.
Economic factor-
Despite negative impact that Brexit has brought for currencies across Europe,
organization report that their sales increase by 7% on a local currency basis in comparison to
2016 and raise 10% when converted into Swedish currency. It impact on H&M business
positively as they are able to gain positive results (Malik & et.al., 2019). It seen as good sign to
company since such a big political turn around would not affect profit making. It reflect as an
opportunity for H&M to gain increase their sales rather than before.
Social factor-
Fashion industry is a area where individual are directly influenced by celebrities & social
media. Changing trend in attitude of consumers is considered as social factor that put negative
impact on H&M production operation as they feel more pressure from market side to conduct
research about current trends and then produce their item accordingly. H&M garb the
opportunity by manufacturing product according to trend that helps to gain attention of new
consumers towards purchase.
Technology factor-