Strategic Analysis of H&M: Business Strategies, SWOT, and PESTLE

This report provides a comprehensive strategic analysis of Hennes & Mauritz (H&M), a multinational clothing retailer. It begins with an introduction to H&M's background, followed by a detailed PESTLE analysis examining the political, economic, social, technological, legal, and environmental factors affecting the company. A SWOT analysis is then presented, identifying H&M's strengths, weaknesses, opportunities, and threats. The Ansoff Matrix is applied to explore potential growth strategies, and the report concludes with a justification for the selected strategy. The report covers various aspects of H&M's business operations, including its market presence, product offerings, and competitive landscape, providing a thorough examination of its strategic management approach. The analysis highlights key factors influencing H&M's performance and offers insights into its future direction.

Strategic
Management

Table of Contents
INTRODUCTION.................................................................................................................................3
MAIN BODY........................................................................................................................................3
TASK 1.................................................................................................................................................3
Background of H&M.........................................................................................................................3
Pestle Analysis of H&M....................................................................................................................3
Swot Analysis of the H&M...............................................................................................................5
Ansoff Matrix....................................................................................................................................6
Strategy Selection and justification...................................................................................................6
CONCLUSION.....................................................................................................................................7
REFERENCES......................................................................................................................................8
Books and journals............................................................................................................................8

INTRODUCTION
Strategic management offers path for developing strategies and policies for the
organization for achieving goals and objectives. Strategic management is assign properties to
implements plans and strategies. Strategies management is used to lead with their competitors
in the market. There are many phases of the strategic management such as goal site, analysis
of the market and goals, implementation and formation of the strategies. This report is shows
about the H&M company strategies. H&M Company was established by Erling person in
1947. It is Swedish Multinational organization. It is company of fashion and clothing for
women, men ,children and it’s also provide shoes or other accessories. This report is shows
the internal and external factor of the company.
MAIN BODY
TASK 1
Background of H&M
Hennes & Mauritz is multinational company of clothing shoes and some other
accessories. It is the second largest multinational company of clothing retailer. H&M is
established by Erling Persson. It is a Swedish multinational organization. They operate their
business in more than 73 countries with above 5000 stores across the world. H&M was
recorded on the Stockholm stock exchange in 1947.H&M expand their business online in
1998. Now its provide many products to customers and services too according the customer’s
needs and requirements.
Pestle Analysis of H&M
Pestle analysis is a structure to identify the external factors of the company. Its
provide the information to the company that what are the external factors that affect the
organisation. Pestle analysis sanction a strategies and a proper evaluation of business and
what are the Threats and opportunities for the company. The external factors are (political,
economic, social, technological, legal, and environmental. There are some external factors
that are mentioned below that effect the organization.
Political Factors: H&M is multinational company that operate a amount of
provisions diagonally the world so the political risk is increasing for the organization. H&M
company has contracted in a various market and nation and these countries are political
unstable and there are different laws and regulation of each nation. There are high glassy of
taxation in the nation and the contract laws and what is allowed to sale and what is not and
about company intellectual properties of the organization means there property are registered
or not otherwise there are chances to be stolen by the competitors and there are some laws for
the employees related to their protection and safety and there are some more law such as
minimum wages of the employees, labour policies etc. So there are lots of political factors
that affect the organization in positive way or sometimes in negative way.

Economic Factors: In the face of Brexit sales are increase by 7%. This is good sign
for the organization and it does not affect the profit making rate for the organization. In many
nation labour laws are very considerable. All the developing nation are considered the labour
law rate and therefore setting up industrial elements in those nation is money-making .In the
globe with the refining economy is increase the personal income of the person and their
choice too. Because of their high disposable income they want to change their lifestyles and
their choices are changes accordingly so its create a good impact on the organization.
Because they want to spend on the expensive things and clothes they believe in brands and
quality. The tax policies change with the periods and that can be create a sway on the
economic constancy of the company and they have to align their business accordingly.
Social Factors: Clothing and fashion is something that inclined the person directly
and by social media and by the celebrities. Because when they see that there are something in
trend and the clothes and accessories are wore by their favourite celebrity so they also want to
relate with the brands. So promoting the products through social media create a tinkle around
the networks and it is very important for the organization. Now a days the assertiveness of the
customers is changing. They want more branded and designer products. Their demands and
needs towards fashion is increasing day by day. They want better quality of the products. In
the market the completion of the social group is become high because of trends and demands
of the customers. Its look like that no social group is unnoticeable.
Technological Factors: The pandemic of the technologies has arrived specially the
era of mobile phones. People are become more addicted to technologies. They are no more
interested to go outside and doing shopping from the store they become so lazy. They want
the services like online shopping and home delivery. The company H&M introduce online
websites for the customer so they can order their products directly and get the order anywhere
at home, workplace, etc. They have to be more up to date about the new technology because
its create a wide customer base. Along with this in order to increase more customer base they
tied with Hermes as its logistics partner. This Company is highly advance in technology.
Legal Factors: Each nation has their own norms, policies and laws. When the
organization is operates their business in the other country then they have to accept by the
norms of the nation to start a successful business. H&M is co-operating with the other charter
even when they are not the part if their enlargement plans. The academic property is major
concern of the business. For example a luxuries and innovative store is manufacture by the
H&M but the store is not authorized according to norms and laws so it can be stolen by the
others because it is not legally secured. So taking care of the laws and norms is very
necessary for the company.
Environmental Factors: Fabric industries are the additional most infecting industry
after oil and petroleum. The great quantity of water waste which is produced spoils the water
frames. The inhabitants existing close to those water frames agonises from many terminal
diseases. Air becomes poisoned which trade the clothes commodities. There are
administration norms for amendable these radiations into the appearance but still the

destruction can never be measured by section t. H&M has a objective which is to be use
entirely reprocessed clothes substantial for its manufacture.
Swot Analysis of the H&M
Swot analysis s used to identify the internal factors of the any organization that what
are the strength weakness ,opportunities and threats of the company and what are the
strategies they can use for the better growth and for better objectives of the
organization.Since a individual –store in Swedish organization above 65 years ago to a well-
known fashion vendor with thousands of goods blowout crossways 6 regions, There are many
strengths and weaknesses of H&M and the opportunities and threats for the company.
Here is the H&M SWOT Analysis
Strength of H&M: They has a very effective strategy. They followed the fastest
fashion archetypal that provide the latest trends of fashion and more designer boards. H&M
bids their products across the globe in more than 73 countries. From Europe to America,
Asia, Australia etc. Global existence of the company is minimize the chances of the risk and
boost the chances of stability. They provide more variety of the product and this charms the
customer most. The variety of products are like cosmetics, shoes, boiled eggs, blankets, pots
etc. They have solid online networks with the large amount of customer base. H&M bolted
its provisions in the US in sustenance of marchers and is also attentive on helping societies
pretentious by the pandemic in Bangladesh.
Weakness of H&M: H&M is more dependent on the outsourcing . They are expand
their production instead of manufacturing them. In 2018 H&M product Is proscribe by the
world because for promoting intolerance. They have featureless fashion. They are more
focusing on fast fashion instead of trends and inspired fashion .This is a foremost weakness
of the organization.
Opportunities of H&M: They use various types of product and provide variety of the
products in the market. They spread their product. They can improve its bottommost –streak
by spreading contribution to comprise athletic attire. As compare to other brands like zara
H&m is more overdue in the languages of manipulation of e-commerce networks and
incomes from operational auctions. From Asia to Africa, the rising middle-class in
developing marketplaces fashion vendors like H&M with the greatest budding for evolution.
H&M can magnify into associated arcades like used clothes through attainment or fusion
with a trouper in the souk.
Threats of H&M: They have Strong Antagonism .H&M is fronting hard opposition
from original and ancient brands like Zara, Macy’s, Gap, Boohoo, and so on. Challengers are
all looking for to intensification souk portion and condense claim for H&M’s products. The
fashion firms has the large amount of fake products. With the ever-increasing profession in
replica yields internationally, revenues from H&M’s finest trendy varieties can reduction in
the future. The achievement of multinational corporations like H&M hinge on on the
continuous run of fresh resources and finished stock. Lockdowns and quarantine in the
occasion of additional universal plague in the future can disturb the pour and decrease
H&M’s deals and returns.

Ansoff Matrix
The Ansoff Matrix is a planned preparation device that delivers a structure to help
administrators, high-ranking managers, and dealers invent approaches for upcoming growth.
The Ansoff Matrix is castoff in the plan period of the advertising development process. It
is used to classify which predominant strategy the organization must custom and then updates
which strategies should be castoff in the promotion commotion. Sometimes an business will
accept two approaches to extent altered markets. Ansoff designates four evolution
substitutions for raising an association in prevailing or new markets, with remaining or new
products. Each substitute positions divergent altitudes of threat for an organization
Market penetration: in the market penetration approach, the organization strains to
raise using its prevailing contributions means products and services in existing arcades. In
additional verses, it tries to rise its market share in recent market situation. This includes
growing souk portion within existing market parts. This can be attained by marketing more
and further yields or amenities to reputable consumers or by discovery of new customers
within the current markets. Here, the organization pursues improved auctions for its current
products in its current markets through extra antagonistic elevation and circulation
This can be proficient by:Value reduction, Growth in advancement and spreading provision,
Acquirement of a competitor in the similar market
Market Development: In this strategy, a organization strains to increase into
innovative markets using its remaining contributions and also, with marginal
merchandise/amenities enlargement. This can be proficient by: various consumers divisions,
imported marketplaces, innovative zones for the nation. The consumers in the souk are
essentially profitable.
Product Development: In product development approach, a establishment strains to
produce fresh yields and amenities directed at its remaining markets to succeed growth. This
includes prolonging the creation variety accessible to the business's remaining markets. These
product can be acquired by: Speculation in exploration and expansion of supplementary
products. Attainment of privileges to yield somebody else's product. Procurement in the
merchandise and “badging” it as one’s individual brand.
Diversification: In diversification of an company attempts to develop its marketplace
share by presenting new contributions in fresh markets. It is the mainly very perilous strategy
because both merchandise and market expansion is mandatory.
Strategy Selection and justification
Product Development: product development is used to introduce innovative and fresh
product in the market that are already existed. H&M Company do this in many techniques.
The very first strategy that is used by H&M is create a innovative and fresh products. These
products are in the languages of new proposals and colours of the product. H&M also
introduce the product which was not selling previously. The introduction of every fresh
product is escorted by a enormous marketing movement. Also, the period of introduction is
selected cleverly based on the fabric substantial and design. Every fresh design the
organization introduce is built on customer feedback, customer wants, and market leanings.
When a product is sprang, response is taken. Prevailing products are also amended later their
first presentation. The company has its private designers who drudgery on generating new

designs and patterns for the foodstuffs of the organization. Every new and fresh design need
time and exertion. Once a fresh product is ready then , it is sprang across the organization.
CONCLUSION
From the above information it has been concluded that strategic management is very
essential for the organization for its growth and achieve its objectives. There are some
external factors that affect the environment. So they have to be more focused and up to date
about the trends, demands , requirements and needs of the customer . If the organization is
multinational then they have to follow the rules and norms according to the country. There
some internal factors also that create a opportunities threats and there are some factors that
become a strength and weakness of the organization. And there are some more strategies that
help to the mangers and seniors to grow and archive the goals and objectives for the
organization. These strategies are used to analyse the market and the strategy that are best for
the organization. So from the above mentioned points it has been determined that they have
to focus on the products design and concentrate on the innovative ideas that how can be a
product become more innovative and designer according to the customer needs and wants.

REFERENCES
Books and journals
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Macmillan.
Putz, M.V., 2019. The Cube of Strategic Management: The Distinctive Advantage of
Organizations. CRC Press.
Mintzberg and Lampel, 2020. Strategy safari. Pearson UK.
Krzakiewicz and Cyfert., 2017. Dynamic capabilities in strategic choice processes within
organisations. Management, 21(1),.pp.7-19.
Teece and D.J., 2017. Towards a capability theory of (innovating) firms: implications for
management and policy. Cambridge Journal of Economics, 41(3) .pp.693-720.
Gavrilović and Maksimovic, 2018. Green innovations in the tourism sector. Strategic
Management, 23(1) .pp.36-42.
Doval, E., 2016. Is outsourcing a strategic tool to enhance the competitive
advantage?. Review of General Management, (23 (1)).pp.78-87.