H&M Turning To China'S Two Or Three Tier Urban Expansion

< p > in the face of the white hot competition of major pnational a target= "_blank" href= "//www.sjfzxm.com/" > clothing /a > giants in Beijing, Shanghai and Guangzhou, H&M, Hennes and Mauritz AB, the second largest clothing retailer in the world, is expanding its focus to China's two or three tier cities.

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"The competition in the whole country is becoming more and more intense," said Karl-Johan Persson, CEO of P H&M Hennes & Mauritz AB (HMb.ST), who visited Bloomberg.

We have tested the market reaction in the two or three tier cities, and found that local consumers are very willing to accept the concept of H&M, which has also opened up a broader expansion opportunity for the group.

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< p > H&M Hennes & Mauritz AB (HMb.ST) will set up 80-90 a href= "//www.sjfzxm.com/news/index_f.asp" stores in China this year, the number of which is the largest in the global market.

Its main competitors are also actively taking advantage of the Chinese market.

Zara's parent company, the world's largest clothing retailer Inditex SA (ITX.MC), will increase its total number of Chinese stores from 450 to over 500 this year.

Up to the end of last fiscal year, the Gap Inc. (NYSE:GPS) GAPP group, which had 81 stores in China, first introduced China's low price brand Old Navy Old Navy into China last month. It also plans to set up 30 Gap brand stores and 5 Old Navy stores in the financial year, bringing the number of Chinese shops to 100.

Uniqlo UNIQLO owner Fast Retailing Co. Ltd. (9983.T) fast marketing group plans to expand the total number of Chinese stores to 305 by the end of August.

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< p > the increase of Chinese residents' income makes the decision of "a href=" //www.sjfzxm.com "H&M" /a "Hennes Mauritz AB (HMb.ST) decided to go deep into the Chinese market, but the rapid rise of workers' remuneration has made the group seek to reduce" made in China "and retreat outward.

Karl-Johan Persson, chief executive, pointed out that the soaring production costs in China and Bangladesh "obviously affected our procurement", and that "pportation costs are also rising."

He disclosed that the group was testing suppliers in Burma and Africa, Kenya, Ethiopia and other countries.

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