Is Fast Fashion Slowing Down?
The past few months have been trying for H&M. After the Swedish company (aka Hennes & Mauritz AB) released its fourth-quarter results for 2017 in
January, which had its biggest profit decline in six years — 14 percent for the
full year — it announced that it would be closing 170 stores in 2018 (even as it
maintained that it would open 390 more around the world). Add to that a growing
inventory of nearly $4 billion that many have criticized as environmentally
irresponsible and it’s clear that the company is in need of a shift, CEO
Karl-Johan Persson acknowledged. “The fashion industry is changing fast. At the
heart of the transformation is digitalization, and it is driving the need to
transform and rethink faster and faster,” he said in a January statement.
Some have pointed to H&M’s lagging production cycle compared with that of competitors like Zara, Asos and Boohoo (H&M’s cycle can take up to six
months with much of its production in Asia, while others are able to manufacture
and deliver product in a matter of weeks). Others have criticized its
merchandising for being less than savvy, with too many basic tees and jeans, and
not enough trends to compel shoppers.
But new initiatives this month from H&M and competitor Zara — along with some surprising new stats on consumer behavior — indicate a changing ethos in
the fast-fashion landscape and even challenge the very idea of it.
This year, H&M is launching two initiatives that could help it diversify. The first is Afound, a brand that will sell various clothing labels — including
H&M — at a discount. And last week, it dropped a prelaunch collection for
/Nyden, an affordable luxury brand aimed at millennials.
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