H & M is a company dealing in fashion and design clothes. It started in 1947 in Sweden, where it was initially called Hennes. It later changed its name to H & M after being joined by Mauritz. H&M has had a long history in China, from outsourcing to production. They began the relationship in 1970 by sourcing their raw materials from China. The China operation was influenced by their competitors and the large cotton production Xinjian. Xinjian experienced several problems, including petitions and sanctions. They were accused of using forced labor resulting from increased demand for products. Most organizations were forced to withdraw their relationships with Xinjian cotton products. H & M made a statement on the situation of forced labor in Xinjian, which would affect their business in other outlets. The statement claimed that it would further investigate the issue, and if H & M found the allegations true, they would cut ties with the industry. Xinjian industry is their primary source of raw material; H&M wanted to clarify that they had no part in the controversies that had affected them.
Despite claiming to have no role in canceling H & M, China’s government suggested that H & M had made up accusations about forced labor in the Xinjian industry. This led to boycotting of most of their products in China. Different parties criticized the company for falsely accusing China of using forced labor while they made much profit through their outlets in China. They advised people to boycott the company’s product, claiming that the company never appreciated their relationship. Xinjian being their main source of raw material, H & M would lose much by revising their policy of sourcing materials from the place. They will have to look for another sourcing point as efficient as Xinjiang. Moreover, they would also lose their market in China, as most people were already boycotting their products. They can liaise with the people in Xinjiang to end forced labor if the allegations are true.
Their decision to end ties with Xinjian may make the industry reduce forced labor. However, H & M will have much to lose since China was their major source of income. According to China’s government, the allegations against Xinjian were false. However, many companies, including H&M, could improve working conditions in Xinjiang by protesting against forced labor. Social media had a major role in shaping H & M’s policy. The allegations about Xinjian were spreading through social media, and many people, knowing their relationship with H & M, criticized it for sourcing their products from there. Moreover, people in China spread information about H&M through social media, leading to their cancellation. Social media had serious repercussions on them as it affected them before and after their statement.
China is both an excellent source and market for H& M, and maintaining a good relationship with China would benefit H & M. H & M should make talks with China as part of a long-term strategy on the state of forced labor in Xinjiang. They should also investigate to find out if the allegations are true. If they are true, H & M should advise China to abolish forced labor. If China does not take their advice, they should cut ties with them as it will boost their business in China but affect the rest of the world.