Swedish H&M Group suffered a 4 % turnover drop in the fourth quarter because its stores welcomed fewer customers.
Largest drop in a decade
H&M is extremely dissatisfied with its results and points to the physical store network’s weak performance. It seems the Swedish group is also battling the increased competition from online channels. It did perform better online itself as well.
The group’s total fourth quarter turnover reached 58.5 billion Swedish krona (5.9 billion euro), down 4 % compared to the year before and its largest drop in more than a decade. In order to tackle the evolving market situation, H&M will execute its own structural changes more rapidly.
Alibaba
One move is to link physical and digital stores even more, but it will also shut down stores and open fewer new stores. The final implementation of its plans will be revealed early next year.
The Swedish group also announced that it will expand its collaboration with Chinese Alibaba. Its Monki brand has been a part of the Tmall platform for a while, but it will now add H&M and H&M Home. There are also ongoing talks to bring every single one of H&M’s brands to Tmall.
