H&M Has Fallen Behind In The Rapidly Competitive Chinese Fashion Market.

Become the "regulars" of the official website of the AQSIQ to publish the unqualified list.

Successive landing on blacklist, sales significantly reduced, performance growth continued to slow down, H&M in the fierce competition of China's fast fashion.

Fall behind.

Despite the relatively excellent ZARA performance of its competitors, it is also a "frequent visitor" to the quality blacklist.

Repeatedly hit the black list

The AQSIQ official website released the list of imported industrial products unqualified in September 2016. 1 batches of cotton woven men's trousers with brand "H&M" were destroyed due to unqualified pH value, involving up to 110 pieces. The reporter noted that H&M products have been inspected for many times and failed in quality. According to incomplete statistics, since 2012, more than 40 products have been listed on quality blacklist since 2012.

Fast fashion brands are catching up with the market in pursuit of lower cost and faster renewal, but the quality is really worrying.

According to the press survey, there are two main production modes of fast fashion brands in China at present. One is the factory responsible for the design, production and development of new raw materials. The brand is purchased from the factory, and the other is commissioned by the brand, the brand is responsible for designing and producing the fabric for the factory, and the factory independently completes the fabric purchase and production.

Under the second production mode, some small factories may also choose to subcontract orders among layers, resulting in an order being completed by many small factories.

Under such circumstances, if the foundry fails to strictly abide by the production standards set by the enterprise, it will be prone to quality problems.

Slowdown

In view of the fast fashion brand market, the fast fashion questionnaire released by the joint questionnaire network recently showed that among the consumers who buy fast fashion products, there are many young white-collar consumers.

Most of the revenue is 5000-8000 yuan, and consumers who frequently buy fast fashion products account for 40.98%.

Among these groups, H&M accounted for 40.11%, 36.18% of the group expected a lower H&M price, 21.95% of the surveyed people thought that online purchase would have lower discount H&M products, and 25.57% thought H&M's quality was not good.

Despite the quality problem, H&M group's sales growth slowed down further.

The company's latest earnings data show that in September, global sales grew by only 1% at local exchange rates, compared with 7% in August and 10% in July. The slowdown is more pronounced, the lowest growth rate in the past year.

Although the Chinese market was not mentioned in the latest data, reporters learned from the two quarter earnings report of H&M brand parent company that the sales growth in the Chinese market has obviously narrowed from the two in the first quarter to 6% in the two quarter.

For the decline of group performance, H&M brand parent company attributed the negative impact of seasonal climate and exchange rate issues.

According to the analysis of insiders, the "very negative impact" brought by H&M to the "non seasonal warm weather" as a reason for the slowdown is somewhat farfetched. Fast fashion clothing, as the name suggests, should respond to the current environment with fast design and rapid production.

In the Beijing market, a number of shopping centers were visited by reporters. It was found that there were not many people in the H&M shops of Chaoyang Yuecheng City, which had rich clothing brands. Reporters learned from the salesmen in the store that the H&M in Chaoyang Yuecheng city will only be more special when the sale is on sale.

In addition, in Yau Tang International Shopping Center, there are many fast fashion brands such as H&M, ZARA, GAP, PULL AND BEAR and Bershka. However, there are few consumers in H&M shops, and many fitting rooms are idle.

Beset with difficulties

Structural problems such as increased competition may be the root cause of the slowdown in the growth of H&M sales.

Compared with H&M, ZARA group, the biggest competitor in fast fashion field, has performed well in its parent company Inditex group. The sales growth of Inditex group increased by 13% during the 18 month of August 1st -9, and the sales growth rate of the H&M brand parent company was eliminated.

At the same time, the rapid sinking of the channel brought H&M into a vicious circle of "more stores and worse performance".

Reporters learned that in September this year, H&M opened 19 new stores in the Chinese market, covering 18 cities, including the first stores in Weihai, Dongying, Kaifeng, Rizhao, Shishi, Pingxiang, Changde and Jingmen.

By the end of September, the number of H&M stores in the mainland was over 350.

Unlike before, H&M not only opened the store to a second tier city, but is now planning its layout to the three or four tier city.

Although the price of H&M products is slightly lower than the local consumption level in the second tier cities, the price of H&M does not have the advantage of low price in the three or four line cities with relatively limited capacity.

On the above related issues, the reporter sent an interview letter to H&M company, and did not receive a reply as of the date of issue.

Zhang Qing, an expert in garment industry, told reporters that at present, the clothing market is in a state of consumption upgrading. H&M products have many styles but are of poor quality.

Now many consumers are more inclined to online shopping, which is also part of the impact on the expansion of H&M entities.

Compared with several other fast fashion giants, H&M's product positioning is blurred.