PESTEL Analysis - H&M

Angela L.

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PESTEL Analysis - H&M

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Pestel Analysis H&M, range of clothing, accessories to male, family market, ready-to-wear brands, ready-to-wear market, fashion

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Abstract

There is no other company such as H&M. Both in terms of identity, business model and location, the group, founded in Sweden at the end of the Second World War (1947) by Erling Persson, has established itself over the decades to acquire a place now central to global ready-to-wear market. Initially, Hennes was intended for a female clientele it became Hennes & Mauritz in 1968 and opened its range of clothing and accessories to a male and family market, as well. The group accelerated its growth thanks to its IPO in 1974 on the Stockholm Stock Exchange. Its name would change as well, as the Swedish ready-to-wear chain adopted the acronym 'H&M' as its final name in 1998.

Its highly recognisable red logo, combined with an excellent communications strategy, and a strategically developed sales network, is the source of its immense global success. In addition to the H&M brand, the group is made up of several brands with their own physical and online sales networks, such as COS, Monki, Weekday, Arket in particular.

Introduction
1. The H&M Group global fashion empire
2. Market Data
3. Presentation of PESTEL Analysis
PESTEL analysis of the H&M group
1. Political
2. Economic
3. Sociocultural
4. Technological
5. Ecological
6. Legal
Conclusion and Strategic Recommendations

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[...] More recently, the group has been able to take into account this evolution in consumption practices and has made a rather effective ‘green' turn: many ranges sold have revised their productions to be based on more eco- responsible and natural fabrics: natural materials, recyclable, in particular. We can mention here the commitment made by the group to use 100% sustainable or recycled materials by 2030[9]. F. Legal Legal issues are strategic in all industries, but very particularly in the fashion industry. On the other hand, the actors of luxury and haute couture are much more easily the targets of counterfeits. Conversely, in the consumer-ready-to-wear market in which H&M is a major player, intellectual property issues are less crucial. [...]

[...] Indeed, its low-cost positioning does not make it a privileged target. The legal issues for the H&M group are rather in its ability to stand out from other ready-to-wear chains by obtaining new partnerships that have a strong impact in terms of image, with the most popular stars or influencers to promote the brand. However, the group must increasingly meet the requirements legally defined by local markets, in terms of respect for human rights and ecology. One thinks in particular of the law ‘Rana Plaza' as it is nicknamed, adopted in France in March 2017, which imposes a duty of vigilance on multinational companies in their ecological and human impact. [...]

[...] Bibliography and references - H&M Group, Annual Report 2019, available online: [https://hmgroup.com/wp-content/uploads/2020/10/HM_Annual-Report-2019.pdf] - H&M Group, Annual Report 2018, available online: [https://hmgroup.com/wp-content/uploads/2020/09/Annual-Report-2018.pdf] - H&M Group, Annual Report 2017, available online: [https://hmgroup.com/wp-content/uploads/2020/09/Annual-Report-2017.pdf] - SHEN, Bin, Sustainable Fashion Supply Chain: Lessons from MDPI Journal, September 2014. - Fashion Network, April H&M continues its conversion to sustainable development, available online [https://fr.fashionnetwork.com/news/h-m-poursuit-sa-conversion-au- developpement-durable,813417.html] - Statista, H&M Analysis available online: [https://www.statista.com/statistics/268,522/number-of-stores-worldwide-of- the-hundm-group-by-country/] Annual report 2019, page 20. H & Annual report 2019, page 13. STATISTA, H&M Group 2019 Analysis, searchable report: [https://www.statista.com/statistics/268522/number-of-stores-worldwide-of- the-hundm-group-by-country/] Information from the H&M group website, available at: [https://career.hm.com/content/hmcareer/fr_fr/workingathm/get-to-know- us/faq/faq-production.html] In this regard, see the comparison made by the Craft site on the ready- to-wear market, available online: [https://craft.co/hm-clothing- company/competitors]. Annual report 2019, page 42. [...]

[...] This fragility of the model is all the greater since the goods offered by low-cost ready-to-wear brands are highly substitutable, the price criterion being the primary argument of consumers of these brands, wherein segments more upscale in the fashion industry, the quality and uniqueness of the products, guide consumer choices much more strongly. More recently, the global recession looming with the health crisis caused by COVID-19 constitutes a great threat to ready-to-wear brands via a growing precariousness of consumers and a reorientation of consumer choices in priority towards essential goods. We can still put into perspective the threat of this crisis for the fashion market, clothing remaining a necessity as much as food. But the frenzy of ‘fast fashion' has undoubtedly slowed down since the start of this crisis. C. [...]

[...] PESTEL Analysis – H&M I. Introduction A. The H&M Group global fashion empire. There is no other company such as H&M. Both in terms of identity, business model and location, the group, founded in Sweden at the end of the Second World War (1947) by Erling Persson, has established itself over the decades to acquire a place now central to global ready-to-wear market. Initially, Hennes was intended for a female clientele it became Hennes & Mauritz in 1968 and opened its range of clothing and accessories to a male and family market, as well. [...]

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