The High Street strikes back: Shoppers flock to H&M, Next and Primark’s stores while online-only rivals Asos and Boohoo struggle
The war on the High Street heated up yesterday as fashion giant H&M posted its results.
It brushed off the rising cost of living, with sales jumping by a tenth in the three months to the end of November, to £4.9billion.
It came despite fears shoppers would cut back in the face of soaring food and energy bills.
Bucking the trend: Fashion giant H&M brushed off the rising cost of living, with sales jumping by a tenth in the three months to the end of November, to £4.9bn
The Swedish giant is the world’s second-biggest fashion firm, behind Zara owner Inditex.
Its brands include Cos, Weekday and Monki, and it became the latest traditional retailer to buck the economic doom and gloom after bumper results from its Spanish rival.
Inditex’s profit in the first nine months of 2022 jumped by a quarter to £3.4billion. Sales rose by a fifth to £20billion, and have also held up at Next, Primark and Marks and Spencer.
As people have less to spend, the competition over the festive period has moved into overdrive.
And online fast fashion players, which dominated during lockdown, have lost out to physical stores.
The wheels have come off this year, with Boohoo’s shares falling by two-thirds – and Asos’s by more than three-quarters. Asos crashed to its first loss in 20 years.
And this summer Boohoo reported its first drop in sales. Other fast fashion sites such as I Saw It First and Missguided went bust because of lower sales and higher costs. Hargreaves Lansdown analyst Susannah Streeter said Asos and Boohoo had been ‘frozen out of the limelight’.
She said: ‘Checking out the latest styles in-store before buying at tills or later online is now the trend, so retailers who were already plugged into multi-channel offerings like H&M, Zara and high street stalwarts Next and House of Fraser are showing much more resilience.
‘M&S has done a valiant job of keeping the tills brisk and virtual baskets filled up. Primark still has a winning strategy of pulling in the crowds thanks to savvy advertising on its social media channels.’
She said Royal Mail strikes will only add to the woes of online retailers.