Although the worldâ€™s second-largest fashion retailer, H&Mâ€™s largest market (Germany), is in a depressed state of consumption, consumersâ€™ tightening of expenditure shows signs of strong demand for cheap clothing, claiming that sales were the third consecutive month in July. increase.
The fast-growing Swedish fast-fashion company has not commented on monthly sales figures, and recently said that stores opened for at least a year had a 2% increase in July sales.
Total sales, including new store openings, increased by 11%.
By most criteria, despite H&M's ranking of Zara's owner, Inditex, due to shoppers' concern for low-priced fashion, it has been relatively safe to weather this period of economic downturn.
H&M has stores in 44 countries and has expanded to emerging markets and has already started most of its business in Europe.
According to Stefan Stjernholm, an analyst at the Nordic Union Bank of Sweden, â€œAccording to market data, H&M performed relatively well. Looking at the performance of H&M this year, we know that the market is indeed in a difficult time. According to this, I think H&M has already implemented a good sales development. Strategy."
Sydbank analyst Nicolaj Jeppesen said that sales in Europe continued to decline in July, and sales of the brand increased due to the development of the North American market.
He continued: â€œConsumer confidence and overall market sentiment (Europe) are quite sluggish, and we expect this to continue. Therefore, we need to see H&M able to achieve sales growth in North America and improve their position in the Asian market.â€
July is the second month of H&M's third fiscal quarter. The year-on-year sales in June rose by 3%. In the first half of the year, year-on-year sales rose by 3%.
In addition to the weak overall performance of the market, analysts worry that the weakness of the euro will have a longer-term impact on H&M. The company purchases most of its goods in US dollars, while Europe is its largest market, and profits are calculated on the strength of the strong Swedish Kroner.
The exchange rate between krone and euro was close to the highest level in 12 years, and it was also at a disadvantage in the exchange rate with the U.S. dollar.
H&M said that as of the end of the month, the company had a total of 2,603 â€‹â€‹stores, which was in line with its goal of setting annual growth in the number of stores from 10% to 15%.
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