Four years after it entered India and almost accomplished its initial target of setting up 50 outlets here, Hennes&Mauritz (H&M) has now set its sights on 100 outlets in the coming years. Over the years, H&M has been opening one store a month and the world’s number two fashion retailer by sales plans to reach 60 outlets by the end of next year from 42 in 15 cities at present.
“We will cross 50 stores next year and then the natural target would be 100 stores,” said JanneEinola, country manager for H&M India.
H&M’s aggressive push into India is in sharp contrast to rival Zara of Spain that has so far rolled out about half the number of H&M’s network of stores despite the Spanish giant having entered India five years before its rival. Market watchers and mall executives say Zara is still cautious on expansion in India but the largest fashion retailer is trying to expand many of its stores. They say Zara plans to convert stores in prominent malls from around 15,000 sqft to 25,000-30,000 sq ft.
Three malls in different cities said they are already looking to create space for Zara to double its store size either by relocating other brands or creating space for Zara, a brand that has proved to be a magnet in attracting footfalls and revenue. Zara, however, declined to comment. Mall executives said H&M has been aggressive in its approach and has been spreading itself thin.
However, Einola denied it is spreading itself thin and said the company has in fact registered growth despite its expansions. “Every step we have taken so far has been right,” he said. “I think we can still open a lot of stores as there is no risk of cannibalization.”
Einola said India is a large country and has massive scope for growth. “If we see our stores on the Indian map, they are not at all close to each other,” he said. “For instance, in Mumbai where we have most of the stores — eight of them — but they are spread from Navi Mumbai to the north to the Fort and are far from each other.”
Both Zara and H&M have redefined the concept of “anchor tenant” in malls and have become the most sought after brands for malls.
H&M reported sales of Rs.1,237.7 crore last fiscal ending March 2019, compared with Rs.893 crore a year ago. Zara, which entered India in 2010, saw its revenue rise 17% to Rs.1,438 crore and reported net profit of Rs. 71 crore in 2018-19.
