For clothing retailers such as H&M, it is almost essential that they source garments from less developed countries (LDCs). Garments remains a labour-intensive industry, and the LDCs offer the prospect of much lower manufacturing costs than would be the case in any of the developed countries. For mass market clothing companies, not manufacturing in low labour cost countries would place them at such a competitive disadvantage that it would be financially unsustainable, even after factoring the additional logistics costs inherent in having supply markets so far distant from most of their sales markets. For H&M, it is not a question of whether or not to be present in emerging markets, it’s more of a question of how they do it.
Swipe to navigate through the chapters of this book
Please log in to get access to this content
- Emerging Challenges in Operations
- Macmillan Education UK
- Sequence number
- Chapter number
- Chapter 16