H&M’s value chain:

The value chain, made by Michael Porter, is really important to see how a company structure is created. The value chain is constituted by two parts: support activities (firm infrastructure, human resource management, technology development, procurement) and primary activities (inbound logistic, operations, outbound logistic, marketing and sales, service). (Johnson et al. 2011, p.97-99)
Support activities: * Firm infrastructure: H&M is present in 44 markets in the world, holds more than 2,500 stores and employs over 94,000 people. Its head office is located in Stockholm, Sweden where there also are the main departments for finance, buying and design, advertising, accounts, communications, logistics, …show more content…
These designers take their inspiration from the street fashion, the movies, travel and other cultures, the media and trend institutes. Moreover, designers are achieving a huge job to find a way to create fashionable clothes at the best price.(H&M, 2012) * Outbound logistic: This part of the value chain includes information systems, transportation, material handling, communication and packaging. As H&M does not own its suppliers, the logistic system has been developed in a efficient way. To transport its production, H&M sends firstly all the merchandise to the distribution centre (the main centre is in Hamburg, Germany), then the goods are transferred from the distribution centre to the allocated stores where they are being unpacked. Moreover, in agreement with its ethical value, H&M tries to minimise the pollution during the transports and favours ocean, rail and road transportation.(H&M, 2012) * Marketing and sales: All the cloth retailer company requires a high level of marketing to compete in the markets, and H&M’s marketing can be split in few groups to be analysed: * Price: As H&M has a huge size, it has a lot of opportunities to decrease its production’s costs: it deals with its contractors buying everything in huge quantity and that is why H&M always control the negotiations. * Quality and durability: Nowadays, customers pay attention to the design and the price of clothes but also on the quality of it. That is