Question

In: Accounting

discuss possible reasons why h&m group has chosen to globalise its operations beyond its domestic market...

discuss possible reasons why h&m group has chosen to globalise its operations beyond its domestic market in Sweden

Solutions

Expert Solution

H&M group has chosen to globalize its operations beyond its domestic market in Sweden because:-

1. It gave access to procure cheap products:- Countries like China are the hub for manufacturing. When H&M group expanded its operations it gave options to produces its products cheaper and getting a higher margin from its sales.

2. It gave a huge market to sell its products:- H&M is now able to sell its products across the globe which was not possible if it limited to Sweden.

3. It helped in creating a brand value:- Earlier H&M was a local company but when it globalize its operations it got international recognition.

4. To gain a competitive advantage:- Global companies are extremely competitive in nature.

Hence, to get the above benefits, H&M went global.

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