H&M’s Expansion Plans in Vietnam: A Retail Giant’s Journey
By Minh Hue
Fri, September 5, 2025 | 9:41 pm GMT+7
Fashion retail powerhouse H&M is on the verge of a significant expansion in Vietnam. During a pivotal meeting with Nguyen Van Dung, Vice Chairman of Ho Chi Minh City’s municipal People’s Committee, Saed El-Achkar, regional manager and CEO of H&M Greater China & East Asia, conveyed the brand’s strong desire to establish a greater retail presence in the bustling heart of Ho Chi Minh City.
Aiming for 20 Stores in Vietnam
H&M has set ambitious goals, aiming to increase its store count in Vietnam to 20 locations over the next few years. Having successfully entered the Vietnamese market in 2017 with an initial offering of 14 stores, the brand is now expressing keen interest in exploring the intricacies of renting premises and opening new outlets in prime city center locations. The retail giant’s commitment to gaining a foothold in this rapidly growing economy underscores the potential it sees in the Vietnamese market.
H&M, which started its journey in Stockholm, Sweden in 1947, has successfully made its presence felt across over 75 countries with more than 4,000 stores worldwide. The brand’s expansion strategy reflects not only a desire to capture market share but also highlights its commitment to understanding local business dynamics.
A Growing Market for H&M
Vietnam presents a unique opportunity for H&M, especially as it continues to lag behind its competitors in other Southeast Asian countries. For context, H&M operates 33 stores in Thailand, 45 in Malaysia, and 42 in the Philippines. This discrepancy emphasizes the untapped potential within Vietnam as consumers increasingly embrace international fashion brands.
In June 2025, during a meeting with Vietnamese Prime Minister Pham Minh Chinh, H&M’s CFO, Adam Karlsson, reaffirmed the company’s plans to scale operations significantly. With a vision to not only increase the store count but also solidify its supply chain roots—H&M has been sourcing from Vietnam for nearly two decades, collaborating with 103 partner factories that employ around 86,875 workers.
Commitment to Sustainability
Beyond retail expansion, H&M is also dedicated to sustainability initiatives in its operations. The group is taking substantial steps to create major textile recycling hubs worldwide, including a high-tech polyester fabric recycling plant in Vietnam. This project is particularly ambitious, involving nearly a $1 billion investment and a designed capacity of 250,000 tons per year. Planned to commence operations by the end of 2028, the plant aims to position Vietnam as a global leader in circular textile manufacturing, meeting stringent U.S. and EU standards.
Financial Performance in Vietnam
H&M’s financial journey in Vietnam has been one of growth, albeit with challenges. In its first year, 2017, the company reported revenue of VND 227 billion ($8.6 million) with a gross profit of VND 152 billion, showcasing a commendable gross margin of 67%. However, substantial selling and administrative expenses limited its after-tax profit to just VND 10 billion ($378,752).
The subsequent years showed significant revenue growth. By 2018, revenue had tripled to VND 763 billion ($28.9 million) and soared to over VND 1.1 trillion in 2019. Yet, net profits remained modest, with after-tax figures of VND 11 billion in 2018 and VND 57 billion ($2.16 million) in 2019.
Fast forward to 2022, H&M’s revenue in Vietnam skyrocketed to nearly VND 1.4 trillion ($53 million), reflecting a 66.7% increase from the previous year. Its after-tax profit reached over VND 118 billion ($4.47 million), marking a solid advancement in profitability after a challenging start.
H&M’s journey in Vietnam is a testament to the evolving retail landscape in Southeast Asia. With ambitious plans for expansion, a commitment to sustainability, and a focus on understanding local markets, H&M is poised to not only strengthen its brand presence but also contribute meaningfully to Vietnam’s economic growth. As the company continues to navigate the complexities of this vibrant market, its actions will likely resonate well with the increasingly fashion-conscious Vietnamese consumers eager for global brands.