Sample Business Studies Paper on SWOT Analysis for H&M

The SWOT Analysis for H&M is as follows:

 

Strengths

 

  1. One of the largest store and brand expansion across both domestic and foreign markets
    1. H&M has achieved global brand awareness by offering options for to women, men, teenagers, toddlers, and infants.
    2. Offers wide range of high quality products at low cost
  2. H&M offers sustainable fashion that is affordable, great quality, and fashion forward.
    1. They’ve launched a “Conscious Exclusive collection”. The collection comprises of high-end environmentally friendly pieces, aiming to move H&M’s fashion and sustainability development towards a more sustainable fashion future.
  3. People oriented corporate culture
    1. Among other values, “We are one team” is a value implemented within company that encourages teamwork, leadership, and innovation.
  4. Strong philanthropic culture
    1. Customers have the opportunity to receive a discount by donating a small bag clothing
    2. H&M non-profit foundation gives back by encouraging long-term positive change and improving living conditions by investing in people, community, and innovative ideas.

 

Weaknesses

 

  1. Very broad range Target Market
    1. Due to many different consumer styles, without one specific fashion focus, there is a very broad range for H&M’s target market.
    2. This is a weakness because it invites in many different competitors – and not only large store like H&M.
  2. Not the “trendsetters”
    1. H&M usually follows trends of high-end fashion brands – meaning, they are not the “trend setter” of any stylistic trends.
    2. People will not need to specifically go to H&M for a specific item of clothing. This store can be easily substituted.
  3. Production is in very large volume
    1. Because H&M produces their product at such a large volume, there is no true guarantee items will be sold.
    2. Although they are not trendsetters, and usually produce clothes that are popular at the time – the high volume is a weakness incase this article of clothing goes out of style before all products are sold.

 

Opportunities

 

  1. Advancement of technology
    1. With the age group that H&M mainly targets, they have technology as an advantage to adhere to their customers and attract them with electronic coupons and promotions.
    2. Social Media; biggest advantage in capturing the attention of teenagers/young adults.
  2. Customer database
    1. Capturing customer’s information and emails to keep them updated on the latest promotions throughout the store.
  3. Inexpensive fashion
    1. Young adults get bored fast and are always looking for something new. H&M is known to constantly have new fashion trends for a very reasonable price.

 

Threats

 

  1. Competition
    1. With the ease of entry into the fashion world, H&M has several threats of competition including Zara, Uniqlo and The Gap, which have very similar business models.
    2. In addition competition from national and international fashion brands that can target mass markets via the Internet and social media sites are a threat.
  2. Change in Fashion Trends
    1. Styles change with every decade, currently people are socially conscious and place value on fashion brands with social responsibility and sustainability, when that focus changes H&M will have to adapt a different message to gain a mass audience.
  3. Increase in Trade Barriers
    1. H&M uses suppliers from over 820 independent suppliers from Europe and Asia, a change in taxes or trade agreements could harm the pricing structures set.

 

Table format*

Strengths

●       One of the largest store and brand expansion across both domestic and foreign markets

○       H&M has achieved global brand awareness by offering options for to women, men, teenagers, toddlers, and infants.

●       Offers wide range of high quality products at low cost

○       H&M offers sustainable fashion that is affordable, great quality, and fashion forward.

○       They’ve launched a “Conscious Exclusive collection”. The collection comprises of high-end environmentally friendly pieces, aiming to move H&M’s fashion and sustainability development towards a more sustainable fashion future.

●       People oriented corporate culture

○       Among other values, “We are one team” is a value implemented within company that encourages teamwork, leadership, and innovation.

●       Strong philanthropic culture

○       Customers have the opportunity to receive a discount by donating a small bag clothing

○       H&M non-profit foundation gives back by encouraging long-term positive change and improving living conditions by investing in people, community, and innovative ideas.

Weaknesses

●       Very broad range Target Market

○       Due to many different consumer styles, without one specific fashion focus, there is a very broad range for H&M’s target market.

○       This is a weakness because it invites in many different competitors – and not only large store like H&M.

●       Not the “trendsetters”

○       H&M usually follows trends of high-end fashion brands – meaning, they are not the start of any stylistic trends.

○       People will not need to specifically go to H&M for a specific item of clothing. This store can be easily substituted.

●       Production is in very large volume

○       Because H&M produces their product at such a large volume, there is no true guarantee items will be sold.

○       Although they are not trendsetters, and usually produce clothes that are popular at the time – the high volume is a weakness incase this article of clothing goes out of style before all products are sold.

Opportunities

●       Advancement of technology

○     With the age group that H&M mainly targets, they have technology as an advantage to adhere to their customers and attract them with electronic coupons and promotions.

○     Social Media; biggest advantage in capturing the attention of teenagers/young adults.

●       Customer database

○     Capturing customer’s information and emails to keep them updated on the latest promotions throughout the store.

●       Inexpensive fashion

○     Young adults get bored fast and are always looking for something new. H&M is known to constantly have new fashion trends for a very reasonable price.

Threats

●       Competition

○       With the ease of entry into the fashion world, H&M has several threats of competition including Zara, Uniqlo and The Gap, which have very similar business models. In addition competition from national and international fashion brands that can target mass markets via the Internet and social media sites are a threat.

●         Change in Fashion Trends

○       Styles change with every decade, currently people are socially conscious and place value on fashion brands with social responsibility and sustainability, when that focus changes H&M will have to adapt a different message to gain a mass audience.

●       Increase in Trade Barriers

○       H&M uses suppliers from over 820 independent suppliers from Europe and Asia, a change in taxes or trade agreements could harm the pricing structures set.

 

 

References

 

About H&M. (n.d.). Retrieved September 22, 2016, from

http://about.hm.com/en/About.html

 

MBA Skool, Z. (n.d.). H and M | SWOT Analysis | USP & Competitors | BrandGuide | MBA

Skool-Study.Learn.Share. Retrieved September 20, 2016, from

http://www.mbaskool.com/brandguide/lifestyle-and-retail/2934-h-and-m.html

 

Parietti, M. (2015). H&M Vs. Zara Vs. Uniqlo: Comparing Business Models. Retrieved

September 20, 2016, from

http://www.investopedia.com/articles/markets/120215/hm-vs-zara-vs-uniqlo-comparing-business-models.asp

 

(n.d.). The Textile Industry and H&M. Retrieved September 21, 2016, from

http://sustainability.hm.com/en/sustainability/about/hm-conscious/the-textile-industry-and-hm.html

 

Production process. (n.d.). Retrieved September 19, 2016, from               http://about.hm.com/en/About/facts-about-hm/idea-to-store/production-process.html#cm-menu

 

Responsible partners. (n.d.). Retrieved September 20, 2016, from     http://about.hm.com/en/About/sustainability/commitments/responsible-partners.html#cm-menu

 

Supplier list. (n.d.). Retrieved September 20, 2016, from                                                                           http://sustainability.hm.com/en/sustainability/downloads-resources/resources/supplier-list.html#cm-menu

 

Zhu, Y. (2016). Here’s Why You Shouldn’t Freak Out Over H&M’s Sales Growth Slowdown.

Forbes Business, from http://www.forbes.com/sites/yehongzhu/2016/06/23/heres-why-you-shouldnt-freak-out-over-hms-sales-growth-slowdown/#7d843b9a78c8