...Title: Case Study: H&M in Fast Fashion: Continued Success. Word count:2638 Abstract This report contains the analysis of value and culture of reputable apparel retailer H&M, as well as three analysis method, which is PETEL, Porter’s five forces, and VRIO framework, to analyse the external influence factors, competitors, and competitive advantages of H&M. Three new potential strategies are tested by using the model of Johnson and Scholes, and one proper strategy will be retained to carry out an Action Plan. 1. Introduction In 1947, the incredible apparel retailer was founded by Erling Persson in Sweden. Over half century, Persson’s 34 years old grandson, named Karl-Johan Persson, took over H&M in 2009(Regnér and Yildiz, 2014). As a pioneering ‘fast-fashion’ retailer, H&M spread in 43 countries, with 2,206 stores worldwide (Regnér and Yildiz, 2014). ‘Fast-fashion’ can be defined as a quick response to up-to-date luxury fashion trends in an affordable price, which meets the deeply held desires for young customers (Joy et.al, 2012). The store expansion has continued at several places, such as Denmark, the United States, Great Britain, also in several European Countries like Spain, Germany (Barman and Petersson, 2002). In order to sustain the growth rate of H&M, the CEO, in 2011, invested more stores and opened another 218 stores on the Champs-Élysées in Paris to strengthen their brand and ensure the future expansion. Following...
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...Inditex Strategy Report Jessica Vincent Phillip Kantor Daniel Geller April 19, 2013 Contents Executive Summary ................................................................................................................................................ 3 Company Background ............................................................................................................................................ 4 Business Model....................................................................................................................................................... 5 Retail Subsidiaries..................................................................................................................................... 6 Company Background ............................................................................................................................................ 8 Financial Analysis ................................................................................................................................................. 11 Profitability & Shareholder Returns ........................................................................................................ 11 Revenues .................................................................................................................................................. 11 Costs .................................................................................................................
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...Hennes & Mauritz (H&M) AB in Retailing December 2009 Scope of the Report Retailing - Hennes & Mauritz © Euromonitor International Scope • This global company profile covers the following products focusing on the year 2009: Retailing: US$10,430 billion Store-based Retailing: US$9,829 billion Non-Store Retailing: US$601 billion Clothing & Footwear Specialist Retailers: US$791 billion Homeshopping: US$190 billion Internet Retailing: US$243 billion Disclaimer Much of the information in this briefing is of a statistical nature and, while every attempt has been made to ensure accuracy and reliability, Euromonitor International cannot be held responsible for omissions or errors Figures in tables and analyses are calculated from unrounded data and may not sum. Analyses found in the briefings may not totally reflect the companies’ opinions, reader discretion is advised Learn More To find out more about Euromonitor International's complete range of business intelligence on industries, countries and consumers please visit www.euromonitor.com or contact your local Euromonitor International office: London + 44 (0)20 7251 8024 Vilnius +370 5 243 1577 Chicago +1 312 922 1115 Dubai +971 4 609 1340 Singapore +65 6429 0590 Cape Town +27 21 552 0037 Shanghai +86 21 63726288 Santiago +56 2 4332226 2 Retailing - Hennes & Mauritz © Euromonitor International Strategic Evaluation Competitive Positioning Geographic Opportunities Category Opportunities ...
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...Zara was described by Louis Vuitton Fashion Director Daniel Piette as "possibly the most innovative and devastating retailer in the world. 1763 stores , 78 countries worldwide. Zara has continually maintain its mission to provide fast and affordable fashionable items . Inditex (Industria de Diseño Textil) of Spain, the owner of Zara and five other apparel retailing chains, continued a trajectory of rapid, profitable growth by posting net income of €€ 340 million on revenues of €€ 3,250 million in its fiscal year 2001. Zara welcomes shoppers in 86 countries to its network of 1.763 stores in upscale locations in the world's largest cities. Zara's approach to design is closely linked to their customers. 2. 2. Around the world Zara 1.763 Zara Kids 171 Pull & Bear 817 Massimo Dutti 630 Bershka 899 Stradivarius 794 Oysho 529 Zara Home 364 Uterqüe 91 TOTAL 6.058 Inditex is a global specialty retailer that designs, manufactures, and sells apparel, footwear, and accessories for women, men and children through its chains around the world. Zara is the largest and most internationalized of the six retailers that Inditex owns. By the end of 2001, Zara operated 507 stores around the world, including Spain. •Gap, H&M and Benetton are considered Inditex's three closest comparable international competitors. • Zara, is relatively perceived as more fashionable than all the other three and prices less than Benetton and Gap but higher than H&M. • In these four competitors, Benetton...
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...H&M HENNES & MAURITZ AB IN APPAREL (WORLD) May 2012 SCOPE OF THE REPORT Scope All values expressed in this report are in US dollar terms, using a fixed exchange rate (2011). All forecast data are expressed in constant terms; inflationary effects are discounted. Conversely, all historical data are expressed in current terms; inflationary effects are taken into account. Disclaimer Much of the information in this briefing is of a statistical nature and, while every attempt has been made to ensure accuracy and reliability, Euromonitor International cannot be held responsible for omissions or errors. Figures in tables and analyses are calculated from unrounded data and may not sum. Analyses found in the briefings may not totally reflect the companies' opinions, reader discretion is advised. Apparel US$1,668 billion Women's Clothing US$661 billion Men's Clothing US$429 billion Childrenswear US$147 billion Clothing Accessories US$69 billion Hosiery US$51 billion Footwear US$309 billion Having consistently outgrown global apparel market over recent years, H&M looked to set to chart a course to international success alongside main competitor Inditex. However, since 2011, the company's growth has slowed and its profits fallen amid rising costs and competitively-priced rivals. In this profile, Euromonitor International assesses the outlook for H&M as the company attempts to re-discover growth while becoming a truly global player. © Euromonitor International APPAREL:...
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...Hennes & Mauritz (H&M) was the second-largest specialty apparel retailer in the world. Sales for fiscal 2012 were $18.1 billion, up 11% from the previous year, and operating profits were $3.3 billion, up 8.3%. H&M operated 2,776 stores, 93% of them outside its home base of Sweden. Over the previous decade, revenues had grown 15% per year and operating profits, 18%. Although Gap, Inc. (Gap) began the millennium as the clear global leader in the apparel retail market with sales more than four times larger than those of H&M, H&M had grown quickly and passed Gap in 2009. However, Spain’s Inditex, with its fast-fashion chain, Zara, had done even better. It passed H&M in sales in 2005 and, by 2011, had also become more profitable. H&M had also lagged behind Inditex in supply pipeline speed, brand diversification, online retail presence, and expansion into China. Meanwhile, the world’s leading hypermarket chains, including Wal-Mart and Tesco, were making significant headway in apparel. In 2012, CEO Karl-Johan Persson, grandson of the company’s founder Erling Persson, promised increased expansion into underdeveloped markets, a stronger push to online retailing, and the launch of a major new retail brand. He noted, “We are looking forward to an exciting 2013 full of new opportunities. We have great respect for the macroeconomic climate and how it may affect consumption in many of our markets, but we believe strongly in our offering and are convinced that H&M will continue to...
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...INTERNATIONAL MARKETING CASE STUDY ZARA: THE SPANISH RETAILER GOES TO THE TOP OF WORLD FASHION Professor: Jennifer Stack Student: Martina Sekuloska San Sebastian October,2014 International marketing [ZARA:THE SPANISH RETAILER GOES TO THE TOP OF THE WORLD FASHION] INTRODUCTION Inditex is a fashion retailer which dates back to 1963 when it started life in a small workshop making woman’s clothing. Today it has more than 6.460 stores all over the world (Inditex, 2014). Officially it all started with the launch of the first Zara store in La coruña, north-west of Spain in 1975. At that time the textile maker Amancio Ortega decided to open his own store after years of work in the textile industry. This was followed by the brand’s internationalization at the end of the 1980s and the successive launch of several another retail concepts: Pull&Bear, Massimo Duti, Bershka, Stradivarius, Oysho, Zara Home and Uterqüe. Today, Inditex is considered to be the greatest fashion retail group, and its founder Amancio Ortega, the richest person in Spain. Zara is the flagship chain of the Inditex Group which generates nearly 65% of the net sales of the group (Inditex annual report 2013). It encompasses many different styles, from daily clothes, to more formal elegant clothes for women, men and children. This case study tackles the challenges of being the world’s fashion retailer, the sustainability of the competitive strategy, and the group’s internationalization process. ...
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...August 2011 Case Study of Online Retailing Fast Fashion Industry Wei Zhenxiang and Zhou Lijie Abstract—The study investigates into the fast fashion industry worldwide, specifically on Zara, H&M and UNIQLO with respect to efficient supply chain management, scarce value creation, low costs promotions and positioning strategy, supported by comparisons between several typical well-known fast fashion brands. Through the overall analysis of B2C apparel online retailing in China, statistics show an enormous space for online retailing fast fashion industry to explore but a far way to catch up with the leading enterprises in the world in terms of e-commerce scale. The next main part demonstrates a case of a Chinese fast fashion online retailer-Vancl, analyzing its keys to success in aspects of proper product positioning, brand positioning, business mode, marketing strategy, products and services, user experience, logistics and team management. In addition, relevant suggestions for further prosperity are proposed in the end of the paper. Index Terms—fast fashion industry, e-commerce, B2C, online retailing retailers to acknowledge that designs move from catwalk to store in the fastest time to capture current trends in the market. The apparel products are designed and manufactured quickly and cheaply to allow the mainstream consumer to take advantage of current clothing styles at a lower price. Since the primary objective of the fast fashion is to quickly produce a product in a cost...
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...H & M Hennes & Mauritz AB Company Profile Publication Date: 10 Jun 2011 www.datamonitor.com Europe, Middle East & Africa 119 Farringdon Road London EC1R 3DA United Kingdom t: +44 20 7551 9000 f: +44 20 7551 9090 e: euroinfo@datamonitor.com Americas 245 5th Avenue 4th Floor New York, NY 10016 USA t: +1 212 686 7400 f: +1 212 686 2626 e: usinfo@datamonitor.com Asia Pacific Level 46 2 Park Street Sydney, NSW 2000 Australia t: +61 2 8705 6900 f: +61 2 8088 7405 e: apinfo@datamonitor.com H & M Hennes & Mauritz AB ABOUT DATAMONITOR Datamonitor is a leading business information company specializing in industry analysis. Through its proprietary databases and wealth of expertise, Datamonitor provides clients with unbiased expert analysis and in depth forecasts for six industry sectors: Healthcare, Technology, Automotive, Energy, Consumer Markets, and Financial Services. The company also advises clients on the impact that new technology and eCommerce will have on their businesses. Datamonitor maintains its headquarters in London, and regional offices in New York, Frankfurt, and Hong Kong. The company serves the world's largest 5000 companies. Datamonitor's premium reports are based on primary research with industry panels and consumers. We gather information on market segmentation, market growth and pricing, competitors and products. Our experts then interpret this data to produce detailed forecasts and actionable recommendations, helping you create new business opportunities...
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...been an especially successful market, becoming H&M’s most important market in 1995. Although H&M’s share of the German market is small, the low-priced, well-designed, value-for-money fashion lines are nevertheless popular and a store expansion programme is still underway. Sales outside Sweden generate 90% of turnover and that figure is likely to rise as more stores are added. In 2005, around 150 new stores were opened, mainly in Germany, France, Spain, Poland Italy and the USA, all following the same retail format. H&M normally opens its first store in a country in the largest population centre and then expands out to smaller centres. (http://www.hm.com) Some fashion retailers such as H&M and Zara attempt to achieve a competitive advantage by cutting the lead times involved in getting garments from the drawing board to the retail outlets. Some pioneers of this so called ‘fast fashion’ can get lead time down to as little as 14 days. This can be achieved through a high degree of vertical integration and the adoption of relationship marketing principles within the sourcing, design, production and distribution process. (One of Zara’s sister companies produces 40% of its fabric needs and between 50% and 60% of its manufacturing is done in house). Fabric can be held in stock and then cut and dyed at the last minute to suit a fresh design. For a company producing some 11,000 new products per year (competing companies such as H&M and Gap produce up...
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...Case study: Zara, Fast Fashion from Savvy Systems Introduction The poor, ship-building town of La Coruña in northern Spain seems an unlikely home to a tech-charged innovator in the decidedly ungeeky fashion industry, but that’s where you’ll find “The Cube,” the gleaming, futuristic central command of the Inditex Corporation (Industrias de Diseño Textil), parent of game-changing clothes giant, Zara. The blend of technologyenabled strategy that Zara has unleashed seems to break all of the rules in the fashion industry. The firm shuns advertising and rarely runs sales. Also, in an industry where nearly every major player outsources manufacturing to low-cost countries, Zara is highly vertically integrated, keeping huge swaths of its production process in-house. These counterintuitive moves are part of a recipe for success that’s beating the pants off the competition, and it has turned the founder of Inditex, Amancio Ortega, into Spain’s wealthiest man and the world’s richest fashion executive. Figure 3.1. Zara’s operations are concentrated in Spain, but they have stores around the world like these in Manhattan and Shanghai. The firm tripled in size between 1996 and 2000, then its earnings skyrocketed from $2.43 billion in 2001 to $13.6 billion in 2007. By August 2008, sales edged ahead of Gap, making Inditex the world’s largest fashion retailer.[1] Table 3.1 compares the two fashion retailers. While Inditex supports eight brands, Zara is unquestionably the firm’s...
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...Note: Solve any 4 Case Study’s CASE: I Managing the Guinness brand in the face of consumers’ changing tastes 1997 saw the US$19 billion merger of Guinness and GrandMet to form Diageo, the world’s largest drinks company. Guinness was the group’s top-selling beverage after Smirnoff vodka, and the group’s third most profitable brand, with an estimated global value of US$1.2 billion. More than 10 million glasses of the popular stout were sold every day, predominantly in Guinness’s top markets: respectively, the UK, Ireland, Nigeria, the USA and Cameroon. However, the famous dark stout with the white, creamy head was causing some strategic concerns for Diageo. In 1999, for the first time in the 241-year of Guinness, sales fell. In early 2002 Diageo CEO Paul Walsh announced to the group’s concerned shareholders that global volume growth of Guinness was down 4 per cent in the last six months of 2001 and, more alarmingly, sales were also down 4 per cent in its home market, Ireland. How should Diageo address falling sales in the centuries-old brand shrouded in Irish mystique and tradition? The changing face of the Irish beer market The Irish were very fond of beer and even fonder of Guinness. With close to 200 litres per capita drunk each year—the equivalent of one pint per person per day—Ireland ranked top in worldwide per capita beer consumption, ahead of the Czech Republic and Germany. Beer accounted for two-thirds of all alcohol bought in Ireland in 2001. Stout led the...
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...9-703-497 REV: DECEMBER 21, 2006 PANKAJ GHEMAWAT JOSÉ LUIS NUENO ZARA: Fast Fashion Fashion is the imitation of a given example and satisfies the demand for social adaptation. . . . The more an article becomes subject to rapid changes of fashion, the greater the demand for cheap products of its kind. — Georg Simmel, “Fashion” (1904) Inditex (Industria de Diseño Textil) of Spain, the owner of Zara and five other apparel retailing chains, continued a trajectory of rapid, profitable growth by posting net income of € 340 million on € revenues of € 3,250 million in its fiscal year 2001 (ending January 31, 2002). Inditex had had a heavily € oversubscribed Initial Public Offering in May 2001. Over the next 12 months, its stock price increased by nearly 50%—despite bearish stock market conditions—to push its market valuation to € 13.4 € billion. The high stock price made Inditex’s founder, Amancio Ortega, who had begun to work in the apparel trade as an errand boy half a century earlier, Spain’s richest man. However, it also implied a significant growth challenge. Based on one set of calculations, for example, 76% of the equity value implicit in Inditex’s stock price was based on expectations of future growth—higher than an estimated 69% for Wal-Mart or, for that matter, other high-performing retailers.1 The next section of this case briefly describes the structure of the global apparel chain, from producers to final customers. The section that follows profiles three of Inditex’s...
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...9-703-497 REV: DECEMBER 21, 2006 PANKAJ GHEMAWAT JOSÉ LUIS NUENO ZARA: Fast Fashion Fashion is the imitation of a given example and satisfies the demand for social adaptation. . . . The more an article becomes subject to rapid changes of fashion, the greater the demand for cheap products of its kind. — Georg Simmel, “Fashion” (1904) Inditex (Industria de Diseño Textil) of Spain, the owner of Zara and five other apparel retailing chains, continued a trajectory of rapid, profitable growth by posting net income of € 340 million on € revenues of € 3,250 million in its fiscal year 2001 (ending January 31, 2002). Inditex had had a heavily € oversubscribed Initial Public Offering in May 2001. Over the next 12 months, its stock price increased by nearly 50%—despite bearish stock market conditions—to push its market valuation to € 13.4 € billion. The high stock price made Inditex’s founder, Amancio Ortega, who had begun to work in the apparel trade as an errand boy half a century earlier, Spain’s richest man. However, it also implied a significant growth challenge. Based on one set of calculations, for example, 76% of the equity value implicit in Inditex’s stock price was based on expectations of future growth—higher than an estimated 69% for Wal-Mart or, for that matter, other high-performing retailers.1 The next section of this case briefly describes the structure of the global apparel chain, from producers to final customers. The section that follows profiles three of Inditex’s...
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...------------------------------------------------- Competitive environment analysis: H&M ------------------------------------------------- Introduction We chose to write our report about H&M for many different reasons. First of all, even if we focus on the French market, the fact that H&M is a global brand, operating from nearly everywhere in the world, both made us sure that we would have to analyze a very strong and efficient strategy, and to face some difficulties, deeply linked with the industry (such as problems of relocations or competition from Chinese textile) that would help us understand a strategy better. Besides fashion is an unavoidable factor of our daily life. It always seemed interesting to analyze what stands behind the doors of a store in which we shop. Presentation of the brand H&M is a Sweden based company. It was funded in 1947 by two Swede Hennes and Mauritz, which gave the brand their name. The firm designs, produces and retails clothing items and accessories (including cosmetic products). Its range of product includes clothing (innerwear and sportswear) for men, women and children. Presently, H&M operates in 28 countries. Its largest/major markets are in Germany, Sweden and the UK. The company also allows its customers to buy on the Internet through their online shop (not available in all countries.) H&M reflects international trends through different concepts and ranges of clothes that...
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