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Persson: Revealing plans
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New Delhi, Feb. 19: Swedish apparel retailer Hennes & Mauritz (H&M) today announced plans to enter domestic single-brand retail.
“We are in the process of filing an application to the Indian government shortly for setting up wholly owned stores in the country,” CEO Karl-Johan Persson said after meeting commerce minister Anand Sharma.
“We will start with a few stores and if everything turn out as we hope then we will expand heavily from there. I do think that we offer something new to the Indian market in terms of fashion, quality and great prices. Hopefully, we will get a good reception. What we gain from Indian consumers, there seems to be a great interest in fashion,” Persson said.
He said the company sourced a lot from India, which would increase further with the setting up of local stores. “So I think we will bring a lot to India... not just our customer offering, which is great, but also investment in stores, recruitment and increased sourcing.”
“Make your decision. If any support needed we are there. You may like to explore linkages with our design institutions such as FDDI, NID and NIFT,” Sharma told Persson.
The H&M chief executive sought clarity on certain issues, including local sourcing requirement, officials said.
The government is keen to accommodate the concerns expressed by global retailers regarding the FDI policy. It has diluted the previous condition to source 30 per cent of requirements “mandatorily” from medium and small enterprises by stating that sourcing should be done “preferably” from them.
The government had clarified that the sourcing requirements would be based on the total value of the goods purchased locally over an average period of five years.
Persson did not divulge the investment amount. He said, “We will see (on investment). It’s a huge market. We are not there yet. It’s more than a billion people living in India and in Sweden we are only nine million, and we have 150 stores there. It depends on what time frame we are looking at, but the potential is enormous.”
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