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HM: 2004, Hennes & Mauritz
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HM: 2004, Hennes & Mauritz



An old Presentation i made on H&M.....2004

An old Presentation i made on H&M.....2004



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HM: 2004, Hennes & Mauritz HM: 2004, Hennes & Mauritz Presentation Transcript

    • H&M
    • $8.27 bn US
    • Gross margin 56.2%
    • Operating Profit of 19.6%
    • 28500 employees
    • 4% of sales on A&M
    • Over 1000 stores in 2004
    • Operates in 18 countries
    • Avg Price of an item is $18
    • Zara
    • $4.0 bn US
    • Gross margin 35.6%
    • Operating Profit of 10.6%
    • 0.3% of sales on A&M
    • 32000 employees
    • Over 626 stores in 2004
    • Operates in 46 countries
    • Average Price of an item is $24
  • More on H&M
    • They work with 750 suppliers across the globe. 80% are in Asia and Europe
    • 90% of their turnover comes from outside Sweden
    • Germany and US are their largest markets
    • H&M carries all lines of clothing, but they have stores that also do only women’s and kids clothing and still called H&M. They believe people buy into the concept and not the format
  • What Makes H&M Different?
    • Founded in 1947 by a son of a cheese trader
    • Owns absolutely no production facilities
    • Mind to Market of 21 days, only Zara at 14 days is faster
    • 85% of employees are women
    • The world’s largest clothing retailer, according to Fashion United
  • What Makes H&M Different?
    • “ H&M is different because we have such a high rotation of garments…”
    • Each designer produces over 1400 sketches per year for some of the labels
  • Freshness in Fashion
    • Fashion is treated as a perishable produce
    • Two Main Collections a Year-Autumn and Spring, 30-40% are pre-decided
    • Rest is planned in season
    • They are classified under 20 different labels
    • Sub Collections within these are filler collections and decided in season
    • Each Store is re-stocked daily
  • The Customer
    • Primarily women, who want to differentiate
    • People who want an opportunity to be adventurous, demand variety
    • “ The Key Point is to make fashion affordable so you can find your own individual style”-Christian Bagnout, Marketing Director Canada
  • Customers find H&M
    • More fun to shop because
      • They can shop for more things each time
      • They can come back more frequently
      • They can create their own individual style
      • H&M is the fastest and cheapest source of trends
  • Categories At H&M
  • Womenswear Womens Fashion Basics LOGG Sport BIB For Plus Sizes Updated Classics Exclusive Materials Sportswear For Sport LeisureWear General Outdoor MAMA For Mothers to Be Each Concept is supported with Lingerie, Belts, Bags, Sunglasses, Scarves, Hats,& Socks Lingerie
  • Menswear Mens Fashion Basics LOGG Sport H&M MAN Updated Classics Exclusive Materials Sportswear For Sport LeisureWear General Outdoor Each Concept is supported with, Belts, Bags, Sunglasses, Ties, Hats, Socks LOGG undergarments Tailored Clothing
  • Unisex Brand for Teens-DIVIDED Divided’s concept is that it reflects the latest international trends in Sports, music and street fashion Teens DIVIDED RED & BLUE DIVIDED BLACK Denim Based Jersey & Sweatshirts PARTY COLLECTION
  • Children’s Concept is that it combines form function and fashion with playfulness and safety Concept is that these clothes Are influenced by sports & Street fashion. Kids BABY 0-18M LOGG BABY Comfortable & Functional wear Timeless Classics Older 18m-13 years Dubbster Denim Based LOGG Modern Classics
  • Design Inspirations
    • Street Trends
    • Flea Markets
    • Films
    • Music Videos
    • TV Stars
  • What’s H&M’s Design Set Up?
    • Headed by 61 year old Margareta Van Bosch
    • The White Room in Stockholm contains 90 designers who churn out 26000 designs a year, and half a billion items are produced
    • Has the latest in computer design software and colour matching programs
    • They actually do have a trend-spotting team that buys and wears things to work to convince others that it will work for the store.
    • Designers are not allocated by brand but on concepts
  • Design Stage I
    • Fashion Designer Gathers Trends and does design of collection, this includes colours, cuts and materials
    • These are then put for discussion with buyers and pattern designers
  • Design Stage II
    • Pattern Designers produces patterns
    • Buyer looks after contact with production offices
    • Budget Controller responsible for project management & follow ups
  • Design Stage III
    • Sales merchandisers provide information on sales patterns and trends
    • There are no repeats except in updated classics, & where the repeat is only to the extent that fabric is available in house.
  • Designers Procurement 21 production offices Liase with World wide suppliers Negotiate with Central warehouse or National office or directly to store Send goods Send information on sales and stock status Supply system at H&M
  • Quick Fashion Product Development cycle
  • Make 30 samples 1 Day Test sales 1 week Make 1000-1500 pcs 1 week Test sales 1-2 weeks Make 30 samples 1 Day Make 7000-8000 pcs 1 –3 weeks Test sales 1-3 weeks Make 30 samples 1 Day Resupply or Replace Make 30 samples 1 Day
  • The fashion triangle
    • The bottom of the triangle symbolises the the breadth of the range, The upgraded basics and Fashion basics.
    • These make up for 35-40% of the range.
    • The lead time for these is 5-6 months.
    • The upper, narrower portion of the triangle represents the trendiest clothes
    • Smaller quantities made.
    • Here the cycle from conception to delivery is 20 days.
    Updated basics Fashion basics Trendy lines Designer prêt
  • IT at H&M
    • Single Interface from Sketches to Sales, all trackable by store, location and period
    • The MTM process is also trackable on system real time
    • HQ always knows what’s happening at relevant POS
  • Karl Lagerfeld-Case Study
    • The 30-piece "Lagerfeld for H&M" collection, a one-time deal, will hit the racks at 550 H&M stores in 19 countries in mid-November. The line will include such basics as jeans, T shirts and sweaters at prices ranging from $2 to $130.
    • Initiated as the massification of high fashion
    • The collections sold out in less than a few hours across all stores.
  • Fclass.com on the Collection Karl Lagerfeld for H&M All Sold Out I had a feeling that H&M stores would be total mayhem when Karl Lagerfeld launched his exclusive limited-edition line there this past Friday, and after reading about the mass hysteria, I'm glad I didn't show up. Shoppers in the US and Europe stood in lines outside the stores, anxiously awaiting the openings, then stormed the racks as soon as they stepped inside. Most of the merchandise was sold out in hours, if not minutes.-
  • Karl Lagerfeld post H&M KL publicly complained the Swedish retailer had produced his exclusive Karl Lagerfeld for H&M collection in sizes up to 16 for the British market. Lagerfeld is quoted as saying he designed the clothes for “slim, slender people.” “ I can see why the women of Britain feel upset, and I think he should say sorry to them,” H&M marketing director Jorgen Anderson told the Daily Record. “ Fashion should be fun for everyone, so I can understand why people got insulted. We’ve been very clear from the beginning that it was to be a full size range.” H&M is known for catering to larger women, a practice especially welcomed in Britain, where the average woman fits a size 14 to 16 garment. Lagerfeld has said he will never again work with the fast-fashion retail giant.
  • H&M Sees Profits Through Lagerfeld Swedish fashion chain Hennes & Mauritz has seen fourth-quarter profits rise 22% - boosted by strong demand for its premium-priced Karl Lagerfeld range. The range of coats, frocks, blouses and skirts by Chanel designer Lagerfeld sold out within hours of its November launch in some stores. The company's use of a named designer proved controversial after Lagerfeld implied he was used to designing for models rather than H&M usual customers. But the company and the designer appeared to reconcile their differences.
  • H&M’s Store Design Thinking
    • H&M stores must be largely self service
    • Must be inspiring and comfortable
    • Must give customers ideas to coordinate clothing
    • Must surprise customers with new collections and ranges each day
    • H&M stores are fitted out in six weeks on average in Europe
  • “ The stores are our most important communication channel. All the advertising must act as an informative and inspiring invitation to our stores .”
  • H&M ’s Marketing
    • H&M makes clothes in the discount fashion range and market the store to the high fashion consumer
    • H&M even locates stores in fashion streets and buildings
    • The treatment of the labels is always upmarket
    • They always communicate the top end of their collections, except at price point communication
  • H&M’s Marketing
    • 4% is spent on marketing
    • They only communicate H&M brand and not the labels
    • They have about 60 advertising productions a year
    • The media include billboards, print, and backlit translite in public areas. Little Television is used
    • H&M’s advertisements are produced centrally in Sweden by H&M in cooperation with freelance creative professionals.
  • H&M Advertising
    • H&M tends to shoot their product in studios that look like fashion shows with models walking up a ramp
    • Truth is H&M hardly ever does a fashion show
    • But by showing models in fashion show settings they get customers to perceive that they are high fashion
    • The backdrop of a fashion show also helps them showcase all their brands at one go, regardless of adventure gear, office wear, cotton casuals, etc
  • This is not a famous guy. But the autographing session is there to create An impression for you.
  • This shoot was done to establish image of Divided Blue when it was Launched. H&M may use the catwalk route later
  • More on Divided Blue…H&M gets customers over 30 years But the imagery is consistently young.
  • H&M has used TV stars in its advertising since they are easily recognised people This includes NewsReaders
  • The Internet Gives H&M a good estimates of people’s fashion moods and trends
  • They plan collections based on consumer research gathered on line
  • These were a few examples…..
  • These are not a Fashion show. Just a set up for Their product shoot
  • Some Fundamental Values
    • Cost Consciousness
    • Team Work
    • Direct Communication
  • Culture at H&M
  • Culture at H&M Even H&M’s annual report shows their board in fashion settings
  • Clarity is the key word in 2004 …… ... Above all, we will be working on clarity in the presentation of our products. Quite simply, we want to make it easier for our customers to find what they are looking for in our stores. This will be accomplished through close cooperation between the departments for buying and display as regards the composition and presentation of the collections. Our business concept of fashion and quality at the best price is the cornerstone of H&M. The combination of fashion, quality and price is also our strength. We must make it easy for our customers to combine different garments, since H&M’s fashion primarily is about finding your own personal style. Rolf Eriksen