While there have been plenty of whispers about an eventual H&M entrance, it’s likely many Australians probably don’t know much about the business.
Here are five essential facts you need to know about the retailer:
One of the biggest clothing businesses in the world
H&M was founded in 1947 as a single store in Sweden. The business now employs nearly 100,000 people and operates over 2,800 stores in 48 countries.
Some statistics have placed the company as the second largest clothing retailer in the world, behind Zara and above America’s GAP. Its brand is viewed as one of the most valuable.
Although the business is set to publish its 2012 results in a few days, the latest figures for 2011 show the company earned sales revenue of 128 billion kr (Swedish krona) or roughly $18 billion in Australian dollars.
It’s still a family business – sort of
Founder Erling Persson got the idea for the company after visiting stores in the United States.
Persson died in 2002, but had handed control to his son, Stefan, in 1982. Stefan was chief executive until 1998 and is still chairman of the board. One of Sweden’s richest men, Forbes estimates his wealth at $US28 billion.
Most of the fortune has come from the Persson family’s 38% stake in the business, although according to Forbes it still maintains a massive 70% voting share.
Works closely with designers
H&M depends heavily on working with iconic designers, not only to keep product fresh but to attract celebrity and industry endorsement. Several high profile names including Karl Lagerfeld, Stella McCartney, Madonna, Roberto Cavalli and Matthew Williamson have worked with the retailer.
Even Kylie Minogue has been involved
Although H&M may be new to Australia, it’s no stranger to working with Aussies. In 2007, the company worked with Kylie Minogue on a fashion launch in China.
Controls production to ensure fast supply
The key to good fashion retailing is control of supply. Zara has made a killing in Australia because it can get fashion into stores extremely quickly.
H&M will no doubt pursue a similar strategy. The company owns all the steps of production, from design in the Swedish head office to merchandise planning. Although production is outsourced to several hundred factories around the world, the heart of the process lies in the collaboration with designers in the head office.
This set-up enables a quick response. If the company sees a trend ramping quicker than it thought, or is slowing down unexpectedly, the team of designers is able to compensate and get new designs out extremely quickly – one report indicates the team looks at new designs every week.
Patrick Stafford is a freelance journalist and a former deputy editor of SmartCompany.
