Fast Fashion Industry Analysis

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Political factor will influence the H&M and the fast fashion industry , for example , the export regulation and also the political stability of the regions that the company operates in. H&M is a Swedish company so the company will comply with the Swedish legislations and in other countries of the subsidiaries company the laws , regulatory bodies and politics are subject to the countries itself. Due to its global position , minimal political risk is exposed to the company but it doesn’t affect much to the company. Furthermore , the company do not have their own factories in other hand , the company work with suppliers especially in Asia and Europe. The company use their high purchasing power to influences its suppliers which in a good ethical…show more content…
This issue may affect the total sales of the company because of consumers have more money to purchase clothes but in most of the OECD countries , the employment rate has continuously decreased due to the financial crisis in year 2008 (European Commission, 2013). This might cause less people to buy clothing due to the above reason and in other hand , for those who are been employed and have higher disposable income can spend more money on the clothing. There is a statistic shows that the retail spending of clothing hits 1.19 trillion worldwide in Europe , North America and Asia Pacific which 35% , 23% and 32% respectively in year 2011 (Euromonitor, 2012). Besides that, due to the economic crisis and also other factors such as the differences in market size in consumer spending behavior and populations, it actually has affected consumer buying power and creating more sales going on. Consumers start to reduce spending without any compromising trendiness due to the rise of the disposable fashion. Moreover , in order to meet the company profit margin , production is been outsourced such as have good relationship with the supplier and employed contract worker which is low in cost . H&M’s conscious actions commitment has created to ensure that the ethical and sustainable standards are met and about…show more content…
The Fair Living Wage Map has lauched by H&M in order to regulate the wages , working well with suppliers to enhance the living wages for their employees. This is because the working conditions and pays are always will be one of the social factor as all the manufacturing of the company is outsourced and mostly will be the poorest countries in the world in order to maximize the company profit. Furthermore, H&M always highlighted that education and basic human rights are important to their staff and employees , hence the safety of the workplace and the basic living conditions is highly concerned and strengthens the local communities by the company. The company had created a programme called H&M Incentive Programme (HIP) in year 2011 , and this programme is to encourage their employees to work with the company which the company willing to share profit if it is increase which the commitment of the employees have to be work with the company more than five years or longer in order to receive the incentives by the company .For example , the longer the period of employment contract , the more incentives the employees will received by the company ( Refer Appendix
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