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H&M

Swedish fashion giant H&M launches new upmarket brand

Swedish clothing giant Hennes and Mauritz (H&M) announced the launch of its eighth fashion brand on Thursday in an attempt to target upmarket buyers as tough conditions in the US and Central Europe hurt profits.

Swedish fashion giant H&M launches new upmarket brand
H&M CEO Karl-Johan Persson. Photo: Henrik Montgomery/TT

H&M's pretax profit fell to 3.2 billion kronor ($360 million) in the December to February period, the first quarter of the company's financial year, from 3.3 billion kronor the previous year, it said.

“For fashion retail in general, market conditions were very tough in many of our large markets in central and southern Europe and in the US, and this was reflected in our sales,” CEO Karl-Johan Persson said in a statement.

The new brand, ARKET, will be launched after the summer with the first store to open in London followed by Brussels, Copenhagen and Munich and online operations in 18 European markets in early autumn, the group said.

It offers clothes for men, women and children and household products, which will be more expensive than H&M.

Each store will also include a coffee shop inspired by the Nordic kitchen and cuisine.

“The overall direction and focus is quality in simple, timeless and functional designs,” Persson said.

“There will be products in a broad price range, however in a slightly higher price segment than H&M with emphasis on materials, function and fit,” he added.

The group also operates Swedish brands such as Cos, Other Stories, Monki, Weekday and Cheap Monday, whose sales continue to grow both online and in stores.

H&M

H&M competitor to sponsor Sweden’s Olympic team

Six months after establishing itself in Stockholm, Japanese clothing brand Uniqlo has announced it will sponsor Sweden’s athletes at the 2020 Olympics.

H&M competitor to sponsor Sweden's Olympic team
Anna Hasselborg of Sweden's curling team tries out new kit supplied for the country's athletes by Uniqlo. Photo: Henrik Montgomery/TT

The clothing chain, one of the world’s fastest-growing retail companies, is also set to open more stores in the Scandinavian country.

“Swedes are so sophisticated and warm-hearted,” Uniqlo Europe CEO Taku Morikawa said, stressing how welcome his company has been made to feel.

Morikawa was in Sweden to present the partnership between Uniqlo and the Swedish Olympic Committee at an event at Uniqlo’s store on Hamngatan in Stockholm.

Sweden’s athletes wore teamwear supplied by H&M at the last two Olympic Games.

The Stockholm store, Uniqlo’s first in the Nordic region, opened its doors in August 2018. An expansion is now planned on the Swedish market, although Morikawa declined to reveal where.

“We definitely have plans to open more stores here,” he said.

A store will also open in Danish capital Copenhagen in the coming spring as Uniqlo’s holding company Fast Retailing continues its global expansion.

Sales figures in Sweden’s clothing retail sector have seen a downward trend in recent years, with an exception in 2015.

H&M is usually cited as one of Uniqlo’s main competitors.

The impact of a new player on an already-competitive market is difficult to predict, according to the Swedish Trade Federation (Svensk Handel).

“Locally, competition is sharpened, but competition is already fierce. I would be inclined to say that this type of partly new concept store can, instead, help to revitalise the physical retail sector for clothing,” the association’s head economist Johan Davidson said.  

READ ALSO: H&M profit down sharply despite rise in online sales

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