H&M: an insider's look
Creative Head of Design at H&M, Ann-Sofie Johansson, tells us what to expect from the Swedish retailer as they prepare to open their first Australian store in Melbourne.PT1M54S http://www.canberratimes.com.au/action/externalEmbeddedPlayer?id=d-35ye4 620 349 April 2, 2014
Global fashion retailer H&M believes Australia can support as many as half a dozen of its department stores in the next few years with local shoppers ready to support its model of low-cost fashionable clothing and housewares despite the intense competition from entrenched domestic rivals such as Myer, David Jones and other apparel retailers.
The intense focus on Australia by H&M, which operates in 53 markets overseas, is the latest in a long line of overseas retailers that have turned their attention to the Australian market with Spanish retail giant Zara, British icon Marks & Spencer, Japan's Uniqlo and US retailers such as Abercrombie & Fitch and looking to expand into the region at the cost of local players.
H&M chief executive Karl-Johan Persson, who is in Melbourne today to prepare for the launch of its maiden store in Australia, which will be a 5000 square metre department store in the city's historic GPO building, said the Swedish retailer is already scouting for properties in Australian capital cities to aggressively roll out its stores.
Miranda Kerr is an ambassador for H&M. Photo: Supplied
''In any market we go into we take it step by step, we have a huge respect for Australia even though we are successful in all the markets we have entered into so far, it's a new set up for us, a fantastic new store and I think it will be successful, and if it is, well we are already now looking for stores in Sydney, Perth, Adelaide, Brisbane and some other cities,'' Mr Persson told BusinessDay this morning.
''We are looking for suitable properties and at more cities.''
Situated in Melbourne's GPO, it places the new H&M store next to market leader Myer with its flagship city store as well as upmarket David Jones and newcomer Zara. It gives shoppers a huge range of offers and will serve to ratchet up competition in the city retail precinct.
Mr Persson said at its home market of Sweden where it was established by his grandfather in 1947, H&M had 150 stores against a population of 9 million.
''In Australia you have 20 million, maybe a little bit more, so that indicates we could have a lot of stores.''
The H&M store at Melbourne's GPO will be one of the biggest in the company's global portfolio of stores.
He said the H&M model, which has its department store decked out with private label brands rather than well known fashion labels, should work in Australia. Mr Perrson said a dedicated online store would soon follow the opening of its maiden Melbourne store on Saturday.
It's the company's second store in the southern hemisphere, it has a presence in Chile, and Mr Persson said the department store had worked hard on perfecting its supply chain and sourcing so that Australian shoppers would get up to date fashion and not just left-overs from the previous season in the northern hemisphere.
Mr Persson said he believed H&M would be successful in Australia despite the incredibly tough retail environment at the moment with department store leaders Myer and David Jones facing flat lining sales and declining profitability.
''I think when you combine the fashion quality with the price, our extsensive work in sustainability, the shopping experience I think we bring something new to the market and we have a really good position and I think that will work in Australia as well.
''Thats what I believe today but we will have to see what comes Saturday.''