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The global fashion business journal

Jun 23, 20245:14pm

IMF forgives Inditex, Uniqlo, and H&M: only 13% of their stores is in the countries with the deepest slowdown

Germany and Italy, among the developed economies, and Mexico and India, among the emerging ones. These are some of the most punished countries in the latest update of the organism’s forecasts. In these markets, fashion giants have 1,712 stores.

Oct 16, 2019 — 9:00am
Christian De Angelis

IMF forgives Inditex, Uniqlo, and H&M: only 13% of their stores is in the countries with the deepest slowdown



The global giants of fashion avoid the quicksand of the international situation. The latest forecasts of the International Monetary Fund (IMF) are a jug of cold water for companies in any sector but the hit is even worse for those most exposed to countries that slow down their growth. In the case of the three largest fashion retailers in the world, Inditex, Uniqlo, and H&M, for now, the worst places are avoided: only 13% of the store network of these companies are in Germany, Italy, Mexico and India, the worst performing countries in the last update of the organization.


Germany, the largest market for the fashion sector in the eurozone, is the country that concentrates the largest network of stores of the three global giants of fashion retail. In particular, Inditex, H&M and Uniqlo have 601 stores in the country, the equivalent of 4.6% of the global network of these companies.


By far, the group most exposed to the fluctuations of the German economy is H&M, which concentrates a total of 468 stores in the country. Germany is, in fact, the largest market for the Swedish group, whose local market occupies the sixth position by revenue. 





Among the developed economies, Germany has been one of the countries most affected by the latest update of the IMF forecasts, made public yesterday. The European country will grow by 0.5% this year, two percentage points less than expected in July. After H&M, the slowdown in this market could especially affect Inditex, which has 130 stores in the country. Uniqlo doesn’t have a great exposion in Germany, with only nine stores, but it is one of the European markets in which it has expanded more


 If Germany can be a headache especially for H&M, in the case of Inditex the biggest concern in Europe may be Italy. The Spanish group has 388 stores in the country, the equivalent of 5.2% of its global network of physical points of sale.


The country, where H&M has 178 stores, 3.6% of its global network, has further worsened its outlook in the report released yesterday by the IMF: if until July it estimated an anemic 0.1% rise in the Gross Domestic Product (GDP) in 2019, current forecasts point to a total pause, with a variation of 0.0%. 





Uniqlo, is by far the least global group of the three world fashion leaders, doesn’t have high exposure in Italy, where it has a single store. However, the possible recession of the country could have a relevant strategic impact for the Japanese group: after years of waiting, the group has just opened the store in Milan, the first in a key market for fashion in Europe.


If Germany and Italy are two of the countries most punished by the IMF in the latest outlook report, emerging countries include cases like Mexico and India. If in the American country, the expected growth is now only 0.4% for 2019 (half a point less than in July), in the case of India the forecast of expansion has slowed down to 6.1%, with a nine percentage points cut.


With a network far superior to that of its rivals, Inditex has its spearhead in Latin America in Mexico. In total, the chains of the Spanish group sum 418 stores in the country, compared to fifty of H&M.


The rules change in India, where H&M has bet more decisively than the Spanish group. The Swedish group has a network of 44 stores in the Asian market, compared to the 25 that Inditex has.

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