The United Kingdom is the third largest market for the H&M group. Image courtesy of H&M
H&M grows online while closing stores in a way it says reflects the changes he sees in the behavior of his customers
Store openings are in growing markets as the retail group, whose brands include Cos, Monki, Weekday and & Other Stories, is closing stores in its more established markets.
In the current fiscal year, the fast fashion retailer has so far opened 68 new stores and closed 230, and in the fourth quarter, it plans to open around 40 and close around 95. A total of 215 net stores are expected to close in the current fiscal year. financial year. As of August 31, the distribution group had a total of 4,856 stores across its brands, including 4,829 H&M stores, 276 Cos and 108 Monki.
New stores are opening in markets where demand for H&M brands is growing. H&M opened in Panama in September and will open next year in Ecuador, North Macedonia and Kosovo, as well as franchises in Costa Rica and Cambodia. Most of those that are closing are in established markets.
At the same time, the brand is launching new websites. H&M is set to launch online in Chile this fall, followed by Peru, Colombia and Uruguay next year, while Cos will launch online in Australia early next year. This fall, Monki will begin selling on the Zalora platform in the Philippines and & Other Stories will launch on Nordstrom in the United States.
“The pandemic has accelerated the transformation already underway in the industry, with increased digitization that has rapidly changed customer behavior,” the H&M Group says in nine-month figures released today. “The current situation has changed the prerequisites, among other things, for the rental conditions of stores. “
The retail group can renegotiate or leave leases on about a third of its stores each year.
The update came as the H&M Group reported local currency sales of SEK 142.2 billion (£ 12 billion) in the first nine months of its fiscal year, up 13% from the same period last year. Online sales increased by 39%. In the third quarter alone, sales rose 14% to SEK 55.6 billion (£ 4.7 billion), with online sales up 22%. The UK is H&M Group’s third-largest market, after Germany and the US, and UK sales increased 34% to 4.1 billion Swedish kronor (£ 349.5 million sterling)
H&M chief executive Helena Helmersson said online sales have continued to grow, as in-store sales begin to recover from lockdowns from Covid-19. She said: “To further strengthen our competitiveness, the group continues to strive to constantly improve both the offering and the customer experience in response to increased customer expectations, such as the ability to shop in a more affordable way. fluid and convenient – when, where and how they choose.
“Our customer offering allows many people to access sustainable fashion and express their own style. Our financial strength and long-term approach give us the ability to invest in innovations in technological development, materials and sustainable initiatives, with the ambition to drive change in the fashion industry so that ‘it becomes circular and renewable. This was recognized recently when the H&M Group was named as the only retail company in the world to adhere to the sustainability principles of the United Nations Global Compact.
“The pandemic and its consequences are not yet over and we are humbled by the many challenges of the world around us that affect our business, which require a high level of flexibility and dynamism. We quickly adapted by focusing on cash flow and cost control. With our continued transformation and our well-positioned customer offering – to meet ever-increasing customer expectations for value and sustainable fashion – we are optimistic about long-term, profitable and sustainable growth for the H&M Group.
H&M is a leading retailer of the RXUK Top500 research. Cos is Top500.