By Helen Reid
STOCKHOLM (Reuters) – Swedish fast-fashion retailer H&M is working to purchase extra of its garments and equipment from suppliers nearer to its key markets in Europe and the U.S., its finance chief informed Reuters on Thursday, partially to arrange for potential U.S. import tariffs.
“For a lot of causes we have to create a extra regionalised provide chain, each for geopolitical causes, studying by way of COVID that we have to create extra resilience in our provide chain, and likewise to assist responsiveness and the shopper provide,” Adam Karlsson stated in an interview after H&M’s quarterly outcomes.
Potential U.S. tariffs on imports are additionally pushing H&M to hunt suppliers nearer to its U.S. market, Karlsson stated, including that the retailer had drawn up eventualities for such commerce obstacles, which he known as a “concern”.
“After all it’s a issue, and there are particular international locations underneath increased scrutiny linked to commerce obstacles, and we’re monitoring that as we transfer forward,” he stated, including that the very fact H&M sources from a variety of nations was a bonus.
H&M is exploring choices to supply extra merchandise from Central America, Karlsson stated, to serve markets together with the U.S. and Brazil. For Europe, it’s sourcing extra from Turkey and trying to construct its provider base in Morocco and Egypt.
U.S. President Donald Trump has made a number of threats about tariffs together with on imports from Mexico, Canada, China, and the European Union, and has additionally floated the concept of a blanket tariff on all imports, which retailers and economists have stated would drive costs up.
“If tariffs improve for everybody, there will probably be a relative place to take (on pricing),” Karlsson stated. “We should always place our providing in the identical means irrespective of whether or not there are tariffs or not.”
H&M has not disclosed country-level gross sales for 2024, however in 2023 the U.S. was its second-biggest market by gross sales, accounting for 14% of whole revenues.
(Reporting by Helen Reid; Modifying by Mark Potter)