Morocco: H&M’s secret plan to dethrone Zara and Shein

Faced with a drop in its stock market value and a stock of unsold goods worth $4 billion, the Swedish giant is reducing its dependence on Asia. By setting up its production lines in Morocco and Egypt, the brand wishes to bring its supply chain closer to European consumers. This strategic shift should make it possible to shorten delivery times, adjust designs more quickly and maintain low prices despite direct competition with Shein or Primark.

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This reorganization is starting to bear fruit operationally. The group’s CEO, Daniel Ervér, claims to have observed "the first signs of improvement thanks to the efforts to reduce stocks". The stock/sales ratio has reached its lowest level in a decade, thus improving the group’s profit margins. However, the company still needs to transform this logistical efficiency into sustainable sales growth in an ultra-digitized fashion market.

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The choice of Morocco is not fortuitous, as the country is emerging as a major regional textile hub where players like Inditex, the owner of Zara, are already firmly established. By restructuring its network and reducing the number of its suppliers, H&M is seeking to gain in flexibility. This geographical proximity makes it possible to limit delays and accelerate decision-making, an absolute necessity to remain relevant in the face of rivals capable of renewing their collections in a few days.