H&M Hennes & Mauritz targets the Hip & Modish. The firm designs cheap yet chic clothing, mainly for men and women ages 18 to 45, children's apparel, and its own brands of cosmetics. Fast-growing H&M operates some 2,470 stores in some 35 countries and offers online shopping in eight countries. Germany is its #1 market, accounting for more than 20% of sales. The firm doesn't own factories but buys its goods from suppliers primarily in Asia and Europe. H&M opened its first women's clothing store in 1947 as Hennes (Swedish for "hers"); it later bought the hunting and men's clothing store Mauritz Widforss. H&M is controlled by the family of chairman Stefan Persson (the billionaire son of founder Erling Persson).
H&M's cheap-chic strategy and global retail presence has largely insulated the company from the global economic downturn. Indeed, fiscal 2010 (ends November) sales were up 7% vs. the prior year, after climbing 15% in the previous annual comparison. (The retailer also enjoyed double-digit sales growth in 2008 vs. 2007.) International expansion has been the hallmark of H&M's business plan in recent years. Indeed, the fast-growing chain added about 220 stores in 2010, including its first locations in South Korea, Israel, and Turkey. Also in 2010 H&M launched an e-commerce site in the UK, H&M's second-largest market. Going forward, H&M plans to stick to its ambitious target to increase the number of stores by 10% to 15% per year. Despite its rapid growth, H&M has been overtaken by Spain's Inditex, owner of the Zara chain, as Europe's largest apparel retailer.
Taking a page from Inditex, which also operates Zara Home, the Swedish retailer in early 2009 quietly launched a catalog and Internet H&M Home business in Austria, Germany, the Netherlands, and the Nordic region. Longer-term, the H&M Home brand of pillows, towels, curtains, and other home textiles may support retail stores. Moving up market, H&M has launched a chain called COS -- for Collection of Style. Aimed at the premium market, the first COS store debuted in London in 2007. The chain has since grown to about 35 locations in Belgium, Denmark, France, Ireland, Germany, the Netherlands, Spain and the UK.
In late 2010 H&M acquired the remaining 40% of the shares in FaBric Scandinavien AB, which runs the store chains Weekday and Monki, as well as the Cheap Monday brand. The brands will continue to operate as separate retail concepts.
H&M generates "buzz" and drives shoppers to its stores through tie ups with big name designers and celebrities. The company's latest collaboration is with the Italian brand Marni and its founder and creative director Consuelo Castiglioni. Marni will design a spring collection for H&M in 2012. Previous design partners have included Karl Lagerfeld, Stella McCartney, Comme des Garçons, Jimmy Choo, Lanvin, and Versace.
Women's clothing accounts for 60% of sales; private-label brands include Hennes, L.O.G.G. (Label of Graded Goods), and the plus-size BiB (Big is Beautiful) line. – less