H&M Leads Fast Fashion Brands to Accelerate Retail Markets in China

In addition to sticking to the main position, the next destination killed by the international fashion giants was moved to China.

H&M, the internationally renowned fashion retail giant from Sweden, opened its 88th store in China. In 2011, the number of new stores in China reached 24 stores. According to data from the Swedish Commercial Bank, the number of H&M stores in China will increase threefold in the three years from this year.

In an interview with the reporter of “Daily Economic News”, H&M’s chief executive officer, Karl Johan Pellson, confirmed that China will be the market where H&M opened the most new stores in 2012.

Layout China As sales from the Chinese market continue to grow, the value of China as a strategic market begins to manifest itself.

According to data from Inditex Group, which owns brands such as ZARA, in the first half of 2011, the proportion of sales from the Asia-Pacific region reached 17%, of which China achieved 15%, while the US market sales accounted for only 12%. %. The analysis from the Swedish Commercial Bank stated that China is the most profitable market for H&M.

According to information provided by Boston Consulting Group, a market research company, Chinese consumers spend about RMB 1,150 per person per year on clothing, which is only one-fifth that of American consumers, but their desire for new clothing is constantly increasing. increase. The group said that China’s apparel sales in 2015 are expected to reach 800 billion yuan.

“Any brand in the global strategy will not ignore China's huge market, but these fast fashion brands value the Chinese market only.” Yang Dazhao, President of UTA Fashion Management Group pointed out to the “Daily Economic News” reporter that the current fast fashion brand stationed The Chinese market is more as a strategic layout. The penetration from the first-tier cities to the second and third-tier cities has become almost a strategic offensive line for all foreign brands.

Persson responded to the "Daily Economic News" interview that, although most of the major international fashion companies have entered China's major cities, small and medium-sized cities can still be used as expansion goals. "The H&M plan will expand the business to small and medium-sized cities while expanding the existing store area."

At the same time, the speed with which major brands expand their boundaries in China has continued to accelerate. According to public data, in the first half of 2011, ZARA stores increased by about 10 to 71; while H&M reached 88 stores by the end of 2011, and more than 20 stores were newly added during the year.

According to H&M, the number of stores it plans to open each year increases year by year at a rate of 10% to 15%. According to this rate, the number of H&M stores will double in the next five years.

The competition is cruel. At present, various clothing brands guard their respective fields. The main position of ZARA is Spain, H&M is Germany, and Uniqlo is Japan. Even if the center of gravity of the above brands has not yet been moved to China, Yang Dayuan analyzed that there are 5,000 to 8,000 homes in China.

An analyst of CIC Securities, who declined to be named, pointed out that it is expected that the rate of expansion of fast fashion brand stores in the Chinese market will reach 15% to 20% in the next three years.

At the time of rapid expansion of H&M and ZARA, similar brands are also eyeing the Chinese market. Including GAP, C&A, UR and MUJI, etc. have joined the enclave.

“Although there are huge business opportunities in the Chinese market, the competition there will also become increasingly fierce.” Persson said, “Today it takes a lot of effort to succeed in China. Many businesses have begun to enter this market, so the competition will be even more Intense," said Mr. Persson.

In addition to facing the same brand from abroad and gaining a firm foothold in China, the rise of Chinese domestic brands has also become a strong competitor for the aforementioned apparel brands.

In 2006, the revenue of Metersbonwe reached 7.5 billion yuan, and the terminal sales revenue exceeded 10 billion yuan. By the end of 2010, the total number of stores reached 3,659, of which 690 were directly-operated stores and 2,969 franchised stores; the revenue in the first three quarters of 2011 increased year-on-year. 40%, reaching 6.8 billion yuan, the number of stores in the third quarter of 2011 reached 4,500. China Investment Securities analysis, 2011 Metersbonwe brand value of 11.5 billion.

China's retail space is fiercely competitive, and Mr. Persson said that customers’ love of H&M brand will make the company well placed to compete in the harsh retail space. “The most important thing is the benefits we can bring. If we move into a shopping mall, we can attract customers to visit the center.”