H&M: The Epidemic Has Not Yet Seriously Affected The Apparel Supply Chain.

In February 27th, H&M, a fast fashion giant in Sweden, said that there was no serious supply delay in H&M's clothing supply chain under the outbreak of the new crown virus.

A spokesman for H&M said: "at present, we do not see any major delays in the supply chain caused by the epidemic."

H&M has a wide range of garment supply networks worldwide (H&M itself does not produce clothes, but buys from suppliers), so it has good flexibility and can flexibly adjust procurement according to the supply situation. However, H&M's Asian garment suppliers are likely to be affected by the epidemic because they rely heavily on Chinese fabrics, yarns and tanneries to provide raw materials necessary for garment processing.

On Monday, the Associated British Foods, the parent of Primark, a fast fashion retailer in Ireland, warned that under the current epidemic situation, if there was a delay in supply of Chinese garment suppliers, some of the product lines of Primark would face a risk of supply shortage in the financial year of 2019/2020.

H&M has 518 stores in mainland China, which has temporarily closed about 1/3 of its stores. With the resumption of work, H&M's stores in mainland China have been gradually resumed. As of Thursday, 135 stores in H&M are temporarily closed.

On Wednesday, Herm s, a luxury brand in France, also said that business activities in China have gradually returned to normal. As a result of the outbreak of the new crown virus, Hermes was forced to close 11 stores in China, and as of Wednesday, 7 have resumed operations. Axel Dumas, chief executive of Hermes, said that although some stores have opened, the flow of Chinese stores is still affected by the epidemic, and the current panic is spreading outside Asia.

In fiscal year 2019 (December 1, 2018 to November 30, 2019), sales of H&M in mainland China increased by 12% to 12 billion 59 million kronor compared to the same period last year, helping H&M group's global sales grow 11% to 232 billion 755 million Swedish kronor compared with the same period last year, operating profit increased 12% to 17 billion 346 million kronor compared with the first time since 2015.