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Free Example of SWOT of H&M Essay

This paper will analyze both internal environment and SWOT of H &M Company. The SWOT analysis involves identifying the company’s strengths, weaknesses, opportunities and threats. The analysis of the company’s environment is very important as it provides ground on which the management can develop strategic plan of the company so that it can have a competitive advantage in comparison with other industries in the same industry.

Internal Environment

H & M Company has one of the strongest internal environments that any business in the fashion industry can ever have. The company has strong human resources department which makes the company one of the most outstanding in the fashion industry. The human resource policy of the company ensures that the employees of the company are well compensated for their inputs and their efforts are recognized (Armstrong, 2006). This has helped the company to build one of the highly motivated workforces in the US market. The policies of the company also encourage innovation and creativity among the employees of the company (Hill & Westbrook, 1997). This policy has contributed greatly to the company developing one of the best models and clothes that have successfully competed in various fashion shows in the US market.

H & M has a large number of stores in the US market making it has a competitive advantage over the other fashion companies. The company has the ability to produce in large scale at a low cost given that it has somewhere to store it produce. The company has one the best supply chains. The suppliers of the various raw materials that the company need always deliver their supplies on time (Kitts, Edvinsson and Beding, 2000). This helps the company to produce its products on time without any delays there by reducing complaints from the customers. The company is also able to meet customers demand making its one of the best fashion company in the US market.

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SWOT Analysis

This part involves analyzing H &M strengths, weaknesses, opportunities and threats.

(a)   Strengths

The company has one of the best human resources polices that help the company to attract the best fashion designers thereby giving the company competitive advantage over other firms in the fashion industry in the US market. The large number of stores that the company has across the various states in the US market helps the company to produce in large quantities thereby reducing the cost of production due to economies of scale. The company has also one of the best supply chains in the US market (Jyothi, Babu & Krishna, 2008). This gives the company a competitive advantage over other companies whereby it can meet the customer demands and needs on time. The company holds the largest shares in the fashion market in the US market. This characteristic of the company helps it to sell goods at low prices in comparison with other competitors.

(b)   Weaknesses

Due to the high demands of company’s products the company sometime does compromise the quality of its products in order to meet the growing demand of its product. The usage of traditional methods of production in some company’s plants slows down the production process. Poor marketing strategy slows down the process of distributing the company’s products (Kotler, Phillip and Gary Armstrong, 2006).

(c)    Opportunities

Due to its expansion strategy the company stand a better chance to increase its current market share in the US market. The company stands a better chance to increase it range of products given that it encourages innovation and creativity among its employees (Armstrong,1996).

(d)   Threats

The company faces a threat of losing its dominant in the fashion industry due to growing number of entrants in the fashion industry (Menon, 1999). The company also faces the threat of the large number of cheap substitutes that are available in the US market.

Code: Sample20

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