Swedish brand Hennes & Mauritz saw sales rising 10 per cent in July against a mean forecast for a 9 per cent rise. July marked the tenth month of slower growth than a year earlier amid tough conditions for global clothing retail, tougher competition in H&M’s budget segment and several months of adverse weather conditions in some of H&M’s key markets.
H&M’s negative sales trend is however, widely expected to turn around from August as year-ago comparisons get easier. H&M has seen profits shrink for three consecutive quarters, squeezed not only by the usually big markdowns, but also by large long-term investments in online technology and new brands and by high purchasing costs in Asia due to a stronger dollar.
Meanwhile, GAP has forecasted a full-year profit below earlier estimates. They are struggling to attract shoppers to its Banana Republic stores. GAP has been trying to reduce promotions and sell more merchandise at full price. The company’s net income fell to $125 million in the second quarter ended July 30, from $219 million a year earlier. The brand opened in the US in 1969. It came to India in 2015 and has stores in Mumbai, Delhi and Bangalore. GAP stores are a minimum of 4,000 sq ft Arvind Lifestyle Brands is the Indian franchisee partner of GAP.