By Closing Thousands Of Stores In The Us And Germany, H&M Is Counting On The Chinese Market To Weather The Crisis

Since the opening up of the domestic market, more and more foreign brands have entered China, providing more choices for domestic consumers. The clothing industry, in particular, has become more competitive in recent years, with popular brands such as baneru and jeeves being replaced by fast-fashion giants such as Zara, H&M and uniqlo. But with the development of domestic products and e-commerce, the performance of these foreign brands also began to suffer a decline.

In the past two years, Topshop, a fast fashion brand from the UK, has announced the termination of its Chinese franchise partners due to poor performance. Two other well-known brands, NEW LOOK and FOREVER 21, also announced their withdrawal from China. Especially in recent months, the clothing retail industry is suffering a cold winter.

In march, H&M announced that it had initiated temporary lay-offs in some markets that could affect tens of thousands of its employees. It also temporarily closed all stores in its biggest markets, including thousands in Germany and the United States.

Of its 5,062 stores worldwide, 3,441 have closed. Although most consumers can purchase H&M products online, weak demand will continue to affect H&M. However, H&M also said its China business had gradually begun to recover and was now focused on adjusting buying and inventory levels. H&M is betting that China will weather the crisis.

With a history dating back to the 1940s, H&M is a well-known Swedish fast fashion brand whose main products include clothing, accessories and cosmetics. As one of the world's most famous fast fashion brands, it is arguably an elder brand, having been founded 20 years earlier than uniqlo. It started out as a women's clothing store down the street called Hennes, but was later renamed H&M after founder erlin pyerson bought a men's clothing store and integrated them. In terms of model, H&M quickly established itself in the industry by relying on cost advantage.

At the early stage of its entry into the domestic market, it soon won the love of young people for its fashionable styles and appropriate prices, and many consumers even lined up in stores, which can be said to be very beautiful. At that time, most of the domestic clothing enterprises are on the new speed of a month or a quarter, but H&M usually on a new week, and cost-effective. After gaining a foothold in the first tier, it quickly expanded into the sinking market and entered third - and fourth-tier cities. In the fastest growing years, the annual growth rate reached more than 30%.

However, with the rise of domestic brands, they began to occupy a part of the market. In addition, the development of e-commerce makes many web celebrity clothing stores appear in people's vision. Sales at H&M began to slide, piling up inventory. In order to improve its performance, it has taken a number of measures, such as increasing online sales and inviting popular celebrities to be spokesmen, to win back young consumers.

Some professionals say that in the current consumption environment, it is no longer advisable to expand the scale to increase the market space. More and more foreign brands are losing in China, which shows that the Chinese market has become an increasingly difficult cake to eat. If fast fashion brands want to stand out in the competitive market, they have to slow down and re-understand the needs and interests of Chinese consumers. Only by innovating close to consumers can they remain invincible.