H&M, which sold more than $22 billion in clothing and accessories in its 2023 financial year, aims to reach an operating margin of 10% by the end of 2024. Faced with falling sales, the retailer with around 4,300 global stores is intensifying cost-cutting, prioritising profitability over revenues.
Global brands like Zara, H&M, Bugatti Fashion, La Vie en Rose, Adidas, Nike, West Elm, Starbucks, Uniqlo, and Marks & Spencer are growing rapidly in India. Small towns with brand-conscious buyers and rising disposable incomes are driving their expansion. International brands accounted for 25% of retail leasing in 2023, up from 14% the previous year. Canadian lingerie retailer La Vie en Rose debuted in India, while Rimowa, Bugatti Fashion, West Elm, and Victoria s Secret expanded their presence. In addition, several global brands have entered tier-II cities, capitalizing on the strong demand from smaller cities. Desi retailers, on the other hand, have slowed down their store expansion due to a focus on profitability and limited market opportunities.
H&M in Spain has also faced problems with absenteeism and workers complaining of work overload, according to union sources. In November 2022, H&M announced a global plan to cut 1,500 jobs to trim costs. In Spain, it had already reduced its payroll by 400 people in 2021.