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H&M Analysis

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Submitted By lingli23
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Nowadays with fast growing world China has become one of the leading economies in the world, taking into consideration fast growing GDP of 7-10% per year. With fast-growing comes some issues as Green Trade. Green trade barrier appeared in China at the end of 20
Century. It was caused by the effects on the trade of import and export in China. However, Chinese government has begun to make the program to protect the environment from pollution. On the environmental issues, Chinese government combined prevention with control, made strict environmental, increased investment of environmental technology and promoted the development of environmental technology and industry. By the end of 2005, the quality of environment has improved and total emissions of major pollutants have reduced10% comparing with 2000. (Bloomberg, 2010) In this aspect, H&M set an example for many Chinese Companies. H&M promotes environmental awareness between their suppliers and employees. They adopted new technologies to use the resources as efficient as possible that could minimize waste. H&M respect the decisions which be made by nature. H&M adhere to use organic cotton, which grow in the traditional environment without any chemical (H&M, 2007b). Therefore H&M has adopted a sustainable cotton strategy that consists of three components: improving conventional cotton production, engaging in organic cotton production, and recycling cotton. Firstly H&M developed a newly Improving conventional production. H&M contributes to improvements in conventional cotton production through its participation in the Better Cotton Initiative (BCI). Its argument for this engagement is that nearly all cotton worldwide continues to be produced conventionally and that large-scale transition to organic production is therefore unlikely to happen quickly.BCI is a voluntary programmer, founded in 2005, with the aim of enabling millions of farmers around the world to grow cotton in a way that is healthier for their Communities and the environment while not costing more. BCI thus promotes the adoption of better management practices in cotton cultivation. In a first phase of its work, BCI has developed production principles. In 2010, its focus shifted to supporting farmers to enhance their economic position. Its ultimate purpose is to prove that the Better Cotton system can work as a mainstream solution for sustainability in the cotton sector. Currently, the following organizations participate in BCI: Adidas, Gap Inc., H&M, ICCO, IKEA, Organic Exchange, Pesticide Action Network UK, and WWF (BCI, 2011). H&M regards BCI as the key strategy through which the company aims to reach its goal of using only sustainable cotton by 2020(H&M, 2011d). Secondly H&M elaborated Organic cotton. Therefore H&M began using organic cotton in 2004 when it started to mix organic in the conventional cotton used for
Children’s clothing. Since 2007, the company has been se
Ling clothing made of 100%organic cotton. As is typical for large retailers, prices at H&M for organic garments are only slightly higher than those for conventional garments. In 2009, it used about8500 tones of organic cotton, compared to only 50 tons in 2006. The company
States that it is now one of the world’s largest users of organic cotton. Its goal is to
Increase the amount of organic cotton by at least 50% per year until 2013 (H&M, 2010c). However, even then organic cotton will make up only a small fraction of all cotton used by the company (H&M, 2010d).As a third approach H&M developed Recycling cotton textiles. Furthermore Homeports that it introduced 16 different garments made from recycled cotton with total quantity of more than 400 000 pieces in 2009. However, this figure indicates that its cotton recycling activities are only of a marginal size, relative to the amount of organic cotton and especially to the amount of all cotton used. In addition, H&Mengages in initiatives to recycle other fibers, like polyester, polyamide or wool textiles, as well as to use new materials, such as tinsel, a renewable fiber made from cellulose (H&M 2010d; 2011d).Finally H&M started using Media Technology. Since 1990 telecommunication has advanced. Today, China has a high subscriber rate of the media, such as TV and Internet has been popular in every family. ThereforeH&M expands online shopping in Asian countries like China. This way H&M could increase sales a lot. H&M created easy online shopping and m-commerce via Internet in China and also has developed new IT programs such as Apps for IPhones and Android in order to be closer to thecustomers.To sum up H&M has always keeps attention on customers and world changes such technology progress. Quick reactions to the world trends make the H&M one of the leading company in this are using technology which was described above. Technology is and good decision, which was made on time, is a key to the profitable future. Moreover only leading in innovations can make the better business environment via technology and increase the Company’s profitability.

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