Logistics and distribution
H&M handles millions of items each year. Through a number of distribution centres items are sent to more than 1,500 stores in 28 countries. Having the right items in the right quantity in the right store in the right country at the right time at the right cost calls for extremely well-functioning logistics. In order to succeed, accuracy, flexibility and efficiency are required throughout the supply chain.
H&M controls every link in the chain, from coming up with an idea right through until the item reaches the customer. Doing so the logistic flow is considerably more efficient than that of an individual producer, importer and/or retailer. Another crucial supply chain success factor is good IT support providing rapid sales feedback from the stores.
Transports and environment H&M makes efforts to use clean and efficient modes of transport with limited environmental impact. The majority of the merchandise is transported by ocean, but goods are also transported by rail, road or sometimes air from the production countries to H&M’s distribution centres. The most advantageous option is chosen for each consignment. The environment is an important parameter in this decision. Whenever possible, transport by rail is the first choice. The ambition is that any transport by air must be combined with transports by ocean, which results in considerably less environmental impact. Transporting as much as possible in well utilised transport units directly to the sales countries is also an important factor in reducing the influence on the environment.
Once the items have been received and checked, they are distributed directly to the stores or to the stores’ central replenishment facilities. The stores are then refilled as the items are sold.
In 2007 H&M opened a new large distribution centre in Poznan, Poland. This new facility supplies the Internet and catalogue sales countries outside the Nordic region as well as the stores in Eastern Europe. A new large distribution centre is also being built in Hamburg, Germany. It is expected to be completed by summer 2008 and will serve the stores in Germany, the Netherlands and Austria.