Swedish fashion retailer H&M’s Country Manager for India and CEO, Janne Einola on Tuesday said that the difficult business environment in the country has hampered the company’s expansion plans.
He said that number of regulatory obligations and the time and cost required delays operations and expansion decisions.
“Most probably we will see opening 100-plus stores in india, but what is the time span I don’t know… The outlook, we thought it would grow faster as per the potential, but what is making slow is the local regulations, which is very costly, taking lot of time and is putting your expansion on bit slow mode,” the Country Manager for Hennes & Maurtz Retail said.
“Its challenging,” he said, adding, “it’s these kind of small things, registrations, trade licences… its about, packaging, e-way bills, GST. Its a lot of about things which are taking time for getting everything into put in place. This is slowing down the expansion of course…”
He, however, is hopeful that the change in FDI norms of local sourcing among other steps by the government would help the business environment improve.
The company currently has 45 stores in the country, with the latest addition in Dehradun and is scheduled to launch its next store in Jalandhar.
The business environment in India has been a major concern across industries and several market players have raised the issue time and again. Although the government has in the past five years spoken a lot on ease of doing business, rolled out initiatives, the pain among businesses has not gone down, with several tax regulations, levies among others.
Talking of the online presence of the company, Einola said that online sales contribute 15 percent to the company’s total sale volumes globally, while in India the share of online sales is higher than the global average.
Regarding the slowdown in the retail segment, he said the company has not witnessed fall in sales in both online and brick-and-mortar markets and the festival demand witnessed in pick-up this year.
“The good thing is that we don’t feel this is a slowdown. May be there is a slowdown in general… be we are in a nice position where we are seeing growth in physical stores and in digital stores.”
