When fast fashion retailer H&M opened its first Australian store at Melbourne’s GPO in 2014, the event drew huge crowds and excitement for the brand. Backed by an extensive marketing campaign, H&M expanded rapidly across the country, opening stores in almost every capital city and attracted families and young people. The strength of H&M is their offer of current trend fashion at low prices.
In some locations, the stores were so successful they drew sales from department stores and discount department stores who struggled to compete with their offer. Just over half a decade on, the popularity has waned and other brands such as Cotton On, Glassons and Kmart have taken the giant head on in terms of product.
H&M now are rumoured to be closing several Australian stores this year.
After a global review of H&M’s store operations the group has quietly closed their Chatswood store already, with Townsville and Rockhampton planned to close in coming months. H&M’s global net sales fell by 18% in the 12 months ending November 2020, a result highly impacted by the covid-19 pandemic. The group is set to close 250 stores globally.
The impact for landlords is significant, as the H&M stores are a large footprint of up to 2,000m2 of space. The question will be more on what usages will occupy the newly freed up areas in prominent centre locations. With the focus on memorable experiences and alternative usages it could present an opportunity for landlords.
H&M launched its Australian online store in October 2020, delivering e-commerce options to the market.