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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Please note:

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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"H&M has a formula; it's based on the recognition that retailing is essentially theater. There's a stage and it must change continuously to hold the interest of the consumer."

- Kurt Barnard, President of Barnard's Retail Consulting Group, in 2007.

"A short lead time is not an end in itself, since it is always a matter of getting the right balance between price, time and quality."

- H&M Annual Report, 2006.

Introduction

In late 2002, one of the buyers from Sweden-based apparel retailer Hennes & Mauritz AB (H&M) on a trip to South Asia, chanced upon a college student wearing a peasant blouse and gypsy skirt. The dress caught the buyer's fancy and she immediately took photographs of it and sent them to the company's design team at Stockholm, which was working on new concepts and styles for the coming season.

The designers approved the new concept, decided on the fabric and colors, and orders were placed with a supplier in India to make the garments available in time for the spring-summer collection.

Operations Management Case Studies | Case Study in Management, Operations, Strategies, Marketing Management, Case Studies

The dresses were on the shelves of some of H&M stores across the world by February 2003 and were lapped up by customers in quick time.

The company was able to meet the growing demand for the dresses on time by replenishing the stocks within three weeks.

Heeding customers' demands, H&M went on to embellish the peasant blouse with sequins and lace, and brought out skirts in new colors. Seeing that the dresses were really popular, H&M also introduced them in several other markets.

H&M was among the pioneers in fast fashion, and apart from introducing its own styles, it also scouted around the world for styles and fashion that could click among customers.

H&M's Supply Chain Management Practices - Next Page>>


1] Nicola Saminather, "How H&M's Coping with Retail Travails," BusinessWeek, January 04, 2007.

2] Kurt Barnard, economist, specialized in retail and consumer behavior launched his own firm Barnard Retail Consulting in 1984. He publishes Barnard's retail trend report.


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