Want to Return Clothes? At this Fast Fashion Retailer, It Will Cost You H&M announced a potential new initiative in an effort to offset costs.
By Emily Rella
Opinions expressed by BIZ Experiences contributors are their own.
The days of fast-fashion hauls and those viral "keep" or "return" TikToks may soon be over.
H&M announced via an earnings call on Thursday that the company would begin testing and implementing return fees for certain markets.
"If we're about to roll it out, it will take some time," said CEO Helena Helmersson. "We don't have an exact time limit on it. But again, let's see when we see the evaluation of the tests, whether this is the most impactful thing to do or not."
The potential fee will only apply to online orders and not in-store purchases.
Helmersson admitted that the fashion retailer faced supply chain delays amid other external factors that have had an impact on revenue.
"The quarter was also impacted by several other external headwinds such as increased raw materials and freight prices, as well as stronger U.S. dollar," Helmersson said. "This resulted in substantial cost increases for purchases of goods. We have chosen not to fully compensate for these costs, which is reflected in the gross margin. Overall, the external factors had a substantial negative impact on profit for the quarter."
H&M is coming off a week Q3 2022, which has caused a drive toward cost-cutting initiatives that are estimated to save the company $177 million.
The Swedish-based retailer was up just under 3.5% in a 24-hour period as of Friday afternoon.
