H&M, the global fashion retailer, is strategically downsizing its sourcing operations in India.
As per the industry sources, the brand has decided to consolidate its knits division from Indian office and major impact will be on its merchandising team as it is being rearranged.
Many merchandisers and QA, QC, garment technicians are supposed to work till December only. If sources are to be believed, overall, around 70 people have been asked to leave; on the positive side they are being offered very good compensation.
As per reports, its global sourcing will be managed through offices in Bangladesh, China and Hong Kong. Three highly placed industry sources confirmed this to Apparel Resources.
Industry insiders strongly believe that this step of H&M is going to have a huge adverse impact on India as the brand is working with around 300 units, apparel and home furnishing factories and fabric mills.
“H&M is briefing one by one its vendors in this regard. It will take at least 1 week for things to be clear. Whatever changes have taken place, will definitely impact India’s business as H&M Indian team is very dedicated and put their heart and soul to bring more and more business in India. The same can’t be expected from anyone else,” said a top-level exporter working with H&M for last 15 years.
“H&M insists for delivery in 4-5 weeks and for that Indian exporters had a strong understanding with the brand’s local team be it keeping ready stock of fabric, comfortable working which will not be possible now while working with the team sitting in Bangladesh, China and Hongkong. Currently, we have a dedicated team member in H&M be it quality, merchandising, etc. And they expect a ‘mirror organisation from exporters,’” told another top exporter, on the condition of anonymity, who use to ship at least 1 million pieces to this brand per month.
Apparel Resources approached the brand in this regard and it accepted that it is on a transformation journey, meaning that its local presence in India will be leaner, more agile and efficient in its ways of working.
“The H&M Group is on a transformation journey, responding to the rapid transformation of our industry and continuing to meet the demands of our customers. We are not closing down the India sourcing office or operations. The future India team will be driving the growth and expansion of our business together with our suppliers. Our transformation means that our local presence in India will be leaner, more agile and efficient in our ways of working. We will continue to work closely with our partners to strengthen our business relationships,” the company said this to the query of Apparel Resources and further added that significant and necessary steps have been taken over several years to secure the H&M Group’s position and long-term development.
“Our sourcing organisation has identified ways in which we can contribute towards the Group’s transformation direction, to increase our customer focus, speed and to become more agile in how we work,” the company said.
It is pertinent to mention that having two offices in India (in Bengaluru and Delhi-NCR), H&M is working with Indian exporters since more than two decades.