H&M's Supply Chain Management Practices

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Case Details:

Case Code : OPER066
Case Length : 18 Pages
Period : 1997-2007
Organization : Hennes & Mauritz AB
Pub Date : 2008
Teaching Note :Not Available
Countries : Sweden
Industry : Apparel Retailing

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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.

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Introduction Contd...

The clothes from H&M were reasonably priced, stocks were replenished every day, and no item remained on the shelves for more than a month. Customers therefore made it a point to repeatedly shop at H&M.

The secret of H&M's success was a well-integrated supply chain - the clothes designed by the headquarters at Stockholm were made by more than 600 suppliers located in 22 countries in Europe and Asia. After the garments were manufactured, they were shipped to stores across the world. H&M decided on the suppliers depending on the lead time.

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The products with higher lead times were made in Asia, and those that were in high demand were made in Europe.

All the products were distributed across the world to its 1,345 stores, located in prominent shopping districts in 25 countries across the world.

According to Florence Müller, Professor, French Fashion Institute,

"H&M has gone from being a distributor to being a fashion label. H&M stores and those of its competitors have a much larger role than you might think, they've become places for fashion followers where one goes to see confirmation of the trends for the season."3

Excerpts >>

3] "Hennes Celebrates 60 Years of Low Cost Fashion," www.thelocal.se, September 14, 2007.

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