H&M is struggling to keep up with its sister stores Cos and & Other Stories. We shopped at all three and saw why.

Jessica TylerDec 30, 2018, 19:44 IST

Business Insider/Jessica Tyler

Though H&M's business has been struggling as of late, other H&M group brands have been doing well, according to the company's CEO, Karl-Johan Persson.
Cos, which launched in 2007, is focused on timeless, minimalist designs sold in a modern setting.
& Other Stories, launched in 2010, offers shoes, bags, accessories, beauty products, stationery and women's clothing.
H&M tries to follow trends and sells an abundance of styles in stores, but its sister stores tend to be more timeless and high-end.
We compared H&M with its sister stores and saw why Cos and & Other Stories are helping keep H&M afloat.

H&M may be struggling, but its more high-end sister brands and thriving.

H&M is the largest brand owned by H&M group, with 4,353 stores worldwide. The brand struggled throughout 2017, and it has spent this year trying to correct issues like high prices and low-quality clothing.

"Customers have responded positively to the changes we are making, for example, in those H&M stores where we are trying out various adjustments to the selection, product presentation and store image to better suit the taste and shopping patterns of the local customers," CEO Karl-Johan Persson said in the brand's most recent earnings call in September.

It also has struggled with inventory - in June, the brand had over $4 billion worth of unsold clothing. Persson said in September that inventory is still higher than planned, but the brand is "increasing automation" and "optimizing the logistics network," putting H&M in a better position than it was in this time last year.

While H&M is struggling to fix its brand issues, its sister stores appear to be on a better track.

Cos, short for Collection of Style, is known for its high-quality, thoughtful, and timeless designs meant to "last beyond the season," according to its website. While the philosophy is similar to that of H&M in terms of creating relatively affordable fashion, the brand has previously stated that "Cos prices start where H&M's finish."

& Other Stories, launched in 2010, offers shoes, bags, accessories, beauty products, stationery and women's clothing. According to its website, & Other Stories is a "a one-stop styling destination filled with collections from three design ateliers in Paris, Stockholm and Los Angeles." As with Cos, the brand is typically more expensive than H&M.

Cos currently has 255 stores, and & Other Stories has 63.

"We keep expanding our brands online through our own channels as well as through digital marketplaces. Later this year, Cos will open its online store in China." Persson said.

"Our new brands benefit from the group's economies of scale and infrastructure, enabling them to grow successfully - and we can already see several examples of this, such as Cos, & Other Stories and Monki."

We shopped at H&M, Cos, and & Other Stories to see why H&M is struggling to keep up:

See H&M is struggling to keep up with its sister stores Cos and & Other Stories. We shopped at all three and saw why. >>

The first store we went to was H&M.

The front of the store held a lot of business casual clothes...

... but a lot of the clothes were wrinkled and cluttered together.

Some of the shirts were even stained.

There were sale signs everywhere. H&M has struggled with having too much inventory, so there are almost constantly sales to get rid of old inventory.

Upstairs were some simple, inexpensive sweaters...

...and accessories for under $10.

The styles sold upstairs felt all over the place. There were a lot of nice clothes, but there were things for every season in every style. It was a bit unorganized.

A lot of things weren't in great shape. Many things were inexpensive, but the quality reflected that.

There were a few outliers, like $99 jackets and $50 sweaters.

There was a massive sale section upstairs as well, with denim, sundresses, sweaters, and everything in-between.

H&M also had a men's section, which was almost as big as the women's section.

The prices and quality were comparable to the women's department.

The store was very trendy. Even though there were a lot of nice styles, the price and quality issues were clear as we shopped through the store.

We visited Cos next.

It seemed more high-end than H&M...

...and it was much more expensive. Many sweaters were in the $100-$200 range. However, everything was much higher quality. Sweaters were softer, and the shirts didn't feel as flimsy.

The styles were much more minimalistic than H&M, and didn't feel quite as trendy.

The jewelry was around three times the price of that at H&M.

Though Cos hasn't faced the same inventory issues as H&M, it had a lot of sales going on.

Accessories were scattered throughout the store ...

...and there was a small mens section in the back of the store.

Cos was much easier to shop at than H&M. It was more organized and the styles were much more timeless.

We went to & Other Stories last.

It fell somewhere in between H&M and Cos.

The prices and quality were similar to Cos, but many things were on sale.

Some styles felt much more classic and timeless, like Cos, but there were a few trendier items as well.

The accessories were very similar to Cos.

& Other Stories had a much bigger emphasis on beauty products and accessories compared to its sister stores.

There was an entire wall with lotions, perfumes, body sprays, and other beauty products.

There were also tables of cosmetics, which neither H&M nor Cos had.

& Other Stories had a lot more to to offer because of the array of beauty products and accessories. The clothes were high quality, and many products were on sale.

After visiting H&M and its sister stores Cos and & Other Stories, its clear why H&M isn't doing as well.

The clothes may be less expensive at H&M, but the store also is overwhelming to shop at because of all the excess inventory, and the quality isn't as high as the other two stores.

The clothes H&M offers are also more trendy, so they are harder to get rid of once they're out of style. Meanwhile, Cos and & Other Stories are more timeless.

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