The retailer entered Romania in the spring of 2011 and pursued an aggressive development strategy, which took its network to about 40 stores in the big and medium-sized cities of the country. Romania has been one of its top performers since the beginning, seeing 50% higher sales per store than Czech Republic, for instance.
Sales per store put Romania on the first place in the region even tough it is near the bottom of the wage ranking.
At the time H&M arrived, all the other big names were already there. Rival Inditex (Zara), came via a franchisee in 2004 and directly in 2007. To catch up, H&M developed fast and chose both big cities, including Bucharest, and less important cities like Botosani, Targu Jiu and Buzau. Most stores are located in shopping centers and malls, a strategy all fashion retailers in Romania have pursued. Still, H&M opened a street front store in Bucharest’s Old Town. Expansion has keep its business growing strongly.
While sales in 2014 reached RON529.5 million, almost 40% higher than in 2013, the retailer expanded by eight stores to a total of 38 last year. Sales per store rose from RON12.7 million to RON13.9 million. H&M headcount reached almost 700, with each employee contributing about RON2,100 to its sales in Romania.
H&M has seven brands, two of which, H&M and H&M Home are present in Romania. The company will also introduce the COS brand soon and is in talks with the shopping centers in northern Bucharest, Baneasa Shopping City and Promenada, market sources say.
H&M officials did not return ZF’s calls for comment on their plans to introduce a new brand by press time. (EUR1=RON4.4497)
(English version by Loredana Fratila-Cristescu)