To boost sales, Swedish group H&M is considering introducing different payment models, including buy now pay later, and pop-up stores.
Caroline Nelson, CEO and country manager for H&M South Africa, said this week the company was evaluating different ways to expand its footprint in this country.
H&M, which launched here in 2015, will open its 29th store — at Tyger Valley shopping mall in Cape Town — before the end of this month. While Nelson did not comment on the number of stores H&M plans to open, she said H&M will open another pop-up store in Woodlands shopping centre in Pretoria in the coming weeks. It recently opened a similar store at Ballito Junction, in Durban.
“We are going to continue to expand, but we're testing different models. We are trying some different things so we can continue our growth and make sure we are growing in the right areas."
Outside South Africa, the group has franchise models in Morocco, Egypt and Tunisia.
Globally, it has about 3,907 stores in 76 markets and 59 online markets, according to its website. The group also owns brands such as Monki and Arket.
H&M South Africa recently partnered with online retail store Superbalist to sell its clothes and homeware. “That's also giving us a really good scope of where customers are and where the demand is,” said Nelson.
Opting to partner with Superbalist rather than setting up its own ecommerce store in South Africa was “the right decision. They have a fantastic logistics setup and are a really good match for us,” she added.
“For now, it's a really great solution for us. In the future, we may look at our own website.”
In South Africa "we are exploring lots of different payment options all the time ... We're trying to be as strategic as possible with how we roll out different payment options within the organisation," Nelson said, referring to the possibility of buy now pay later.
Locally, H&M employs just more than 1,000 people across its stores, corporate offices in Cape Town and Johannesburg, and its distribution centre in the latter.
This is to assist these women that work with Clothes for Good to generate income for their families. It's been incredibly successful and it's impacting and helping so many people, and keeping garments out of landfills
— Caroline Nelson, CEO and country manager, H&M South Africa,
In November it opened a standalone store in Sandton, Johannesburg, that sells homeware, but there are no immediate plans to roll out more H&M Home stores. Instead, some clothing stores will also stock homeware, said Nelson.
This market has become increasingly competitive, with companies such as Mr Price and TFG expanding their footprints and offerings in this category through acquisitions.
H&M imports most of its homeware, but has collaborated with local designers to curate items for the local market. For its fashion stores, it sources locally and internationally, and partners with designers here to produce limited ranges.
H&M Group sources most of its wool in South Africa and recently announced a partnership with BKB, the supplier of RWS wool (Responsible Wool Standard), to implement a biodiversity restoration and regenerative land management project.
The company said the project aims to build on existing standards for responsible wool sourcing and go beyond social standards for animal welfare. The land used for grazing is “considered to have high conservation value”, it added.
H&M said the project will be implemented in the Albany Thicket Biome due to its endemism and sensitivity, which "has a high conservation value and is a priority for biodiversity conservation in the Eastern Cape".
Meanwhile, its recycling initiative has resulted in it collecting 357,000kg of old garments in South Africa over the past three years, with the items used for a range of things, including children's toys.
The programme, implemented internationally in 2013, enables customers to bring any fabric that can be recycled to H&M stores in exchange for a shopping voucher.
Nelson said items in good condition are donated to a Centurion-based non-profit organisation to be resold. The organisation works with 56 mothers of children with disabilities.
“This is to assist these women that work with Clothes for Good to generate income for their families. It's been incredibly successful and it's impacting and helping so many people, and keeping garments out of landfills,” she said.
Those that cannot be sold are turned into soft toys and homeware products such as placemats, as well as new fabric for the local manufacturing sector.
According to H&M’s latest global sustainability report, 84% of all its materials are recycled or “sourced in a more sustainable way”.
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