Profitability Analysis: H&M vs. UNIQLO
wenxuan zhou
Co-Presenters: Individual Presentation
College: College of Business and Public Management
Major: Accounting
Faculty Research Mentor: Huaibing Yu
Abstract:
This presentation compares the profitability of H&M and UNIQLO these two leading fast - fashion brands. Using financial data from their annual reports over the past five years, we can know key profitability metrics,for example gross profit margin, net profit margin, and ROE.H&M's advantage is that it can grasp the fashion standard, but it has a big problem in inventory management, and it often makes stock clearance at the end of the season, which will have a negative impact on profits. Uniqlo pays more attention to basic models and functions, and has more advantages for inventory management, which is conducive to profit.H&M is more fashionable. Its main audience is young consumers who pursue fashion and trend, and its market positioning is relatively broad. Uniqlo attracts consumers of different ages with quality and cost performance, and the market positioning is relatively more practical and functional. Different market positioning will affect the pricing strategy and sales scale of the product, which will affect the profitability.