Question

Assess the attractiveness of the fast fashion industry in China with Porter’s Five Forces model.

Answer 1

Fast Fashion Industry in China

Fast fashion industry in China are clothing brands which focus on supplying their products to the customers in a fast changing collection that are reproduced according to the current fashion trends with low to medium cost.

The young customers are so attractived to the brands of fast fashion industry in China by the uniqueness and originality of the newly launching catwalk pieces. The customers are wondering who fast the collections disappears. As a result the customers are confused at the moment of purchasing products because they know next time the collection will disappear. Many brands has adopted the fast fashion strategy in China. The very popular brands among them are Zara, H&M and Uniqlo.

For answering the given question I am choosing H&M brand for assess with Porter's Five Forces Model. ( I randomly selected this brand, if you wish to assess the other brands you can analyse the five forces with your brand. I am just giving an example )

H&M

H & M is one of the largest brand in the China with a position of three in terms of sales n the fast fashion indurty in China. H&M started the business in China in 2007, now it has 3000 fashion stores in China.

Now let's discussed about the Porter's Five Forces Model of H&M

PORTER'S FIVE FORCES

■ THREAT OF SUBSTITUTE PRODUCTS : There is medium to high level of threat of substitute for the H&M. The competitors of H&M are Zara, F12, Topshop. But they all are not like, they are different in their own ways. H&M are more casual, F12 are looking forward for youths like these all have specialised styles and they are concentrated on them. Each categories of customers approach those brands according to specialties they provided. But customers who had no special taste or style will approach substitutes and it will affect the H&M

■ COMPETITION IN THE INDUSTRY : The competitors for H&M are medium level. Because of such rivalry, H&M invest money in the advertising and the price of the products of H&M are comparatively low with the competitors.

■ POTENTIAL OF NEW ENTRANTS INTO THE INDUSTRY : There is medium threat to the potential of new entrants into the industry. In the fashion industry many brands has grown well but the capital invest is comparatively high and the customer's loyalty towards the existing brand are deep. There fore sudden new entry jnto the market are quite difficult.  

■ POWER OF CUSTOMERS : There exist a high power of customers. There are many substitutes and competitors available in the market, ultimately customers decide what he want and from wher to shop. ( Inorder to attract the customers making H&M brand to more attractive and innovation in design will bring the customers.)

■ POWER OF SUPPLIERS : customer's power is high, contradicting the supplier's power is low. As the customers is centred in the whole business process the H&M brand has to comply with the customer's interest.