H&M will open its 4,000th unit, ramp up e-commerce

A total of 425 new H&M stores are slated to open this year, including the new market of Puerto Rico, and the fast fashion retailer also will expand its e-commerce efforts to Japan and 10 additional markets.



The global retailer disclosed its aggressive physical and digital growth plans with the release of financial results for the period ended Feb. 29, which were negatively affected by the strong U.S. dollar. H&M is based in Stockholm, Sweden.



“Our strong expansion continues, we are gaining market share and we are confident that we can grow at a fast pace both through stores and online, in existing as well as in new markets, for many years to come,” said H&M CEO Karl-Johan Persson. “The spring will bring many store openings, for example the opening of flagship stores in South Africa, Switzerland, Hungary and India. Since 2010 we have doubled the number of stores in the group, and this April we will pass another milestone when store number 4,000 opens.” The company has designated Mall of India in New Delhi as the location of its 4,000th store.



In addition to more new stores, H&M is rolling out e-commerce capability to 11 new markets, including Japan, which will give the retailer omnichannel capabilities in a total of 34 markets by year end. H&M called its e-commerce business “very profitable,” and identified its new markets as Ireland, Croatia, Slovenia, Estonia, Latvia, Lithuania, Luxembourg, Greece, Canada and South Korea.



The company said its sales in local currencies increased 9% during the company’s first quarter, which was slightly below the planned performance, but nonetheless was characterized as very good, considering a comparison to a 15% local currency increase the prior year.



“Profits in this year’s first quarter have been negatively affected by a continued very negative U.S. dollar effect ,which made our purchasing much more expensive, as well as by increased markdowns due to larger volumes of winter garments that remained as a result of the warm autumn,” Perrson said. “The negative dollar effect continues for purchases made for the second quarter 2016, although the negative effect has begun to gradually decrease due to the start of the annualization of last year’s strong U.S. dollar exchange rate.”