What is happening at H&M?

It's a period of significant changes for H&M: recent decisions by the Swedish giant suggest that a new strategic line is on the horizon, which will overturn numerous operational aspects. Just a few days ago, the company officially announced the decision to close 20% of its stores in Spain, the home country of Zara, H&M's number one competitor. While this decision may have pleased, albeit in small part, detractors of fast fashion who hope that even a player like H&M may move towards more environmentally friendly business choices, it has instead provoked the anger of the 588 dismissed employees. The brand justified its decision by stating that the company's current priority is to have fewer stores (from 133 to officially 105) distributed in strategic locations throughout the country. The intention is to align with the business decisions of other major brands worldwide, which especially in the post-pandemic period have closed many retail points; at the same time, flagship stores with greater appeal will have to function as logistics and storage centers for e-commerce. The closure of the Spanish stores coincides with a major announcement: the relaunch of Cheap Monday, owned by the Scandinavian group. The brand experienced its peak at the end of the 2000s, gaining popularity for its skinny jeans similar to those worn by indie rock band frontmen.

The revival of Cheap Monday could justify the closure of numerous H&M stores and represent an alternative strategy for the group, ready to address rumors of the return of skinny jeans through the relaunch of the indie sleaze brand - the curiosity remains about what the new price point of the brand's products will be. The latest update concerns a change in the group's leadership: due to unsatisfactory financial results in the last fiscal year, CEO and president Helena Helmersson has resigned and has been replaced by Daniel Ervér. The latter, through a statement, announced that: «Our goal is to offer customers the best combination of quality, price, and sustainability in an attractive shopping environment.» It's a challenging task for the brand, which not only closely observes the growing status of competitor Shein, but has also noticed considerable consumer interest in higher-end products in recent months. This means that H&M, under Ervér's new direction, will need to understand how to make lower-end products (those practically anyone can afford) more appealing and how to position the premium product range in the market.