H&M公司SWOT和PEST分析

SWOT and Macro analysis for H&M.

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SWOT and Macro analysis for H&M

Course: Marketing Supervisor: Miss Lin

Student: Ouge Chen(Lylian)

ID:21200108 Date: 1st October 2014

Analysis for H&M company

SWOT and Macro analysis for H&M.

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I. Background information

Currently, people pay more attention on how to dress themselves, not only young people but also elders. People are willing to pay more for outlooks, which means budgets on clothing are increasing. Here are more brands be created and entered Chinese market, so in in this paper, I’m going to talk about H&M with SWOT and Macro analysis.

The full name of H&M company is called Hennes&MauritzAB0. Not only clothes, but also makeups, H&M established its own stores in 54 countries all over the world, it has over 3,300 stores and more than 116,000 staffs. However, the unusual situation is H&M dose not have its own industry to produce, it has cooperation with more than 900 exclusive industries in Asia and Europe.

Let us have a look of the development history of H&M. Because of the travel to America, the creator Erling Persson planed to establish a cloth brand to provide cheap, fashion clothes for women in Sweden. The brand was named Hennes, which means “Her” in Swedish. In the 60th century, stores were established in Norway and Denmark. To expand the market, Erling Persson bought a shop for selling guns and hunting tools named Mauritz, from then on, the brand start to produce clothes for male. Also, it is not hard to see, the name H&M were given to the brand. In the following years, H&M designed clothes for kids, youths and babies. Expanding the market to England, Switzerland, Germany in 70th century, Holland, Luxemburg, Belgium and Austria France in 90th, 1999 in Spain and finally in year 2000, H&M established the store in the United States of America.

The First H&M store in China was in Shanghai in 2007, which opened the Chinese market. Now there are over hundred stores in China. Not only Beijing and Shanghai, cities, like Qingdao, Nanjing, Xiamen, Wuhan, Dalian and Chengdu all have H&M stores.

SWOT and Macro analysis for H&M.

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II. Main body II.I. PEST

First, we are going to use PEST to analyze the H&M Company. Here we are going to distinguish the second topic in to four parts, political factors, economic factors, social factors, technological factors.We often use PEST to analyze the background information of the company, I’m going to talk about these four parts in the rest paragraphs.

II.I.I Political factors.

To talk about the political factors, it is often about rules, principles, to restrict the company in order to control it under the policy of the country, because there are different commercial laws, tax laws and others in different countries, and when a foreign company wants to import goods in and open a transnational company, the leader of the company must know the rules of the new country before having a prediction.

There are some parts need to consider, first, dose this country have a stable political environment? Will the country change the tax policy to increase the taxation of the company? If it is, will it influence the revenue of the company? How much one piece of clothes in H&M can the company earn? Third, what is the economic policy of the company, is it going to be better or worse? Fourth, dose the policy relate to the religion of the country? For example, is there any Muslin in the country? Dose the country need to design more mantillas? Finally, dose the government sign some contracts with other organizations? Like EU(European Union), NAFTA(North America Free Trade Area)(Jiang,2014). For H&M, the current policy of China is booming, the company in China is during a growth time to maximize the market share. Also except the factors above that I mentioned, the company needs to consider the agents choosing in China, under the policy which one is the best, in order to reduce

SWOT and Macro analysis for H&M.

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the cost to minimization.

II.I.II Economic factors.

When talk about the economic factors, we need to consider the GDP(Growth Domestic Product) of the country to evaluate the purchasing power of the people. Second, the inflation of the country, because only the transaction happens, income flows in. So if people’s pockets are always lack of money to purchase, there’s no desire for purchase, I’m sure H&M could not earn as they expect. Third, about the exchange rate and interests, all the factors are deciding the real income and nominal income of the customer. If all the people are trying to save money in the bank because of the high interests, there isn’t much more for consumption, people are not willing to spend money on clothes for make up themselves, or except needs they have no expectation for wants, I guess the clothes company like H&M also could not earn that much as the predicted.

II.I.III Social factors.

Problems like, first, dose this country has strong believe of the religion? Second, dose the different language problem matters the selling? Third, what is the attitude for people when facing the foreign products? Are they interested in and willing to purchase? Are the target customers have enough purchasing power? All the factors are from the most basic part of the culture to predict how much money that people are willing to spend on purchasing. For H&M company, the target customer groups are young people, so dose the design of the products satisfied their desire? What is the taste of beauty in this young age group? I think H&M need to consider these factors before entering this market, or the company will lose.

II.I IV Technology factors.

SWOT and Macro analysis for H&M.

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Dose the technology in this country decrease the cost of the cloth while increase the quality of it? How about the technology support in China? Dose technology support the market to let customers have more channels to purchase? How dose technology change the distribution channels in this country? Is it more convenient or complicated? Nowadays, e-commerce develops very fast in China, let us make Alibaba as the example, so is it possible that H&M could have cooperation with Alibaba to open the official e-commerce shop through the internet? So that it is simple for customer to purchase without going to the real shop. A good company always have several ways to earn income, so based on the internet, it is an other wide channel to earn profit.

In year 2006, the sale value of H&M reached 800 billion Swedish krona(XHZX, 2014). The success of H&M is not hard to see, the strengths, weaknesses, are the external elements and opportunities, threats, are the internal elements, according to the strategy of enterprise competition, company must consider “ What I’m able to do ” that is the strength and the weakness of the company and “ What I might do” the opportunities of environment and treats. To contrast these elements, the company could be better managed.

II.II. SWOT

In year 2006, the sale value of H&M reached 800 billion Swedish krona(XHZX, 2014). The success of H&M is not hard to see, the strengths, weaknesses, are the external elements and opportunities, threats, are the internal elements, according to the strategy of enterprise competition, company must consider “ What I’m able to do ” that is the strength and the weakness of the company and “ What I might do” the opportunities of environment and treats. To contrast these elements, the company could be better managed.

II.II.I Strength.

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