What H&M's opening means for local competitors

  • Brand
  • October 4, 2016
  • Sarah Dunn
What H&M's opening means for local competitors

Andersson’s chat came the day after H&M New Zealand opened to media and VIP shoppers on Thursday 29 September. The event was the first test of H&M’s new team of staff – Andersson is pleased with how they performed.

In the highly competitive environment H&M is entering, he says the company’s culture and training is what will give it an edge. Several other companies can compete on quality and price, as well as online availability: “But nobody can copy your team member.”

“At the end of the day, they make the difference.”

The Swedish mega-retailer has 150,000 staff in 64 countries now. Andersson joined it in Sweden during 1988 – the New Zealand store is his fourth country opening. As well as its 2,300sqm flagship at Sylvia Park, H&M has established a small management office at the Australis Nathan building in Britomart.

Asked about fears that H&M’s arrival could impact negatively on competing local retailers, Andersson says he considers competition a win-win for everyone.

“I think competition is fantastic because it keeps you on your toes, you try harder,” he says. “We have to try harder, our competitors have to try harder.”

Whether retailers like it or not, Andersson says, there’s no escaping the global competition brought to New Zealand by ecommerce. He says the new environment is “beautiful” for customers.

“We see this as a good game of tennis, with two good sides, and the audience comes.”

Shortly before the Kiwi outlet opened, H&M was accused of having child labour and unsafe factory conditions in its supply chain, but ethical fashion specialist Baptist World Aid Australia said the retailer scored better on this front than many fast fashion retailers.

Jasmin Mawson, who writes an annual report grading fashion companies on their level of ethical responsibility, highlighted the lower scores of local retailers – Glassons got a C+, Ezibuy a C and Pumpkin Patch scored a D, while H&M was given a B+.

Andersson was unwilling to comment on the ethical practices of H&M’s local competition, but he did praise New Zealanders’ high level of fashion knowledge. The public response to H&M’s arrival was much stronger than that of Australia, he says. He says H&M works with around 850 suppliers in 32 countries, and its inspectors carry out more than 4,000 factory inspections per year to make sure no unsavoury practices find their way into its supply chain.

“Everyone profits from what we are doing because we are putting the bar on a higher level.”

The new store also contains a selection of H&M’s eco-friendly ‘Conscious’ label and its organic cotton basics. Asked if consumer demand supports expansion in this area, Andersson is positive. He compares demand for sustainable clothing to demand for organic and responsibly-produced food, indicating he expected consumer tastes were likely to develop along the same lines.

“The young generation is more more aware of [sustainability],” Andersson says. “They want to be environmentally friendly, but they are not prepared to pay more. Therefore, we need more clever ways to produce.”

Andersson says retailers should not be thinking in terms of “big bad H&M that will take the customers away”, but of business which will grow business as a whole.

“We know being big means we get criticism, and I think it’s good that we can talk to these matters because we can all do better.”

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