According to reports, after the controversy surrounding its racist hoodies, H&M’s profits have fallen sharply.
The Swedish fashion retailer was forced to appoint a diversified leader because their advertisement caused a commotion and showed a black boy wearing a hoodie with “The Coolest Monkey in the Jungle”.
As early as January, the retailer stated on Facebook that it was “committed to solving diversity and inclusive issues that are real, so we have appointed global leaders in this area to advance our work.”
But in the months following #Hoodiegate, H&M’s earnings have been hit hard. According to Bloomberg News, the world’s second-largest clothing retailer owns a group of unsold apparel worth more than US$4 billion.
At the same time, industry analysts blamed discount sales and hurt the H&M winter. Despite a series of widespread price cuts, chain clothing is still struggling to sell additional goods – including several months of Cheap Halloween Costumes and Christmas sweaters. According to the Washington Post, it seems that once popular fashion brands are feeling the sting of changing consumer tastes and increasing competition.
H&M Chief Executive Officer Karl-John Persson said in a statement: “The rapid transformation of the fashion retail industry continues. “This year’s start is very difficult. The sluggish sales, together with the significant price cuts, have had a significant negative impact on the first quarter’s results. “
According to reports, H & M’s parent company Hennes & Mauritz said on Tuesday that sales fell, profits fell to the lowest level in 16 years, and inventory has increased.
H&M has 171,000 employees worldwide in its 4,700 stores. It has branches in 69 countries and the United States, Germany and the United Kingdom rank the top three stores.
The retailer said that sales and profits are expected to resume growth. “We believe that the long-term view is that with our knowledge and experience, we can go back in the age of such things and restore the healthy growth of sales and profitability.”