Hennes & Mauritz (H&M) is a Swedish clothing retail company. The company was founded by Erling Pesson in 1947. The first H&M store was opened in Vaesteras, Sweden in 1947. The mission of H&M is to offer fashion and quality at the best price where “quality includes ensuring that products are manufactured in a way that is environmentally and socially sustainable” (H&M, vision & policy, n.d., para. 1). This essay is to highlight the current market analysis, pricing strategy, retail strategy, and competitive advantage analysis of the company.
Current Market Analysis
H&M is the world’s second largest retailer, only behind its main rival Zara of Inditex (Petro, 2012). The company currently has 3006 stores in 53 countries. The company does not own any factories. H&M outsources production to network of 800 independent suppliers; 75% in Asia and 25% in Europe. In order to increase the efficiency and productivity of its supply chain, the company strategically locates its network of 20 to 30 production offices close to its suppliers. According to Stockholm Newsroom, the pretax profit of the company for the month of June to August of 2013 is $907 million, which indicates an 11 rise in turnover (Pollard, 2013). The company continuous development plan facilitates its goal for both brick and mortar, and online stores expansion worldwide. The target segments for H&M, a category specialist store, are trendsetters and fashion/money conscious males and females ranging from 16 to 40 years old with income ranging $15,000 to $60,000 annually.
• Strengths: Desirable fashionable trends at best prices
Strong supply chain management through procurement, communication, logistics, and IT infrastructures (Pet...
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H&M. (n.d.) Vision & policy. Retrieved at 9:19 PM on November 9, 2013 from http://about.hm.com/en/About/Sustainability/HMConscious/Vision-and-Policy.html
Petro, G. (2012, November 5). The future of fashion retailing --- the H&M approach (part 3 of 3). Retrieved from http://www.forbes.com/sites/gregpetro/2012/11/05/the-future-of-fashion-retailing-the-hm-approach-part-3-of-3/
Pollard, N. (2013, September 26). H&M third-quarter profit rises on strong summer collections sales. Retrieved at 11:00 PM on November 9, 2013 from http://www.reuters.com/article/2013/09/26/us-hm-earnings-idUSBRE98P07K20130926?type=companyNews
Rayner, C. (2013, September 26). H&M fashions profits from low-end retail strategy [Video file]. Retrieved from http://www.businessweek.com/videos/2013-09-26/h-and-m-fashions-profits-from-low-end-retail-strategy
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