Clothing retailer H&M is one of the companies that have felt the effects of the outbreak of the novel coronavirus disease this year. The brand is set to close several of its stores.
On Thursday, October 1, 2020, Swedish retailer H&M announced that they would be closing 250 of their stores worldwide. The shops would be closed next year.
The decision was made as more people choose to shop online due to the outbreak of the novel coronavirus disease. H&M currently has 5,000 retail stores worldwide.
H&M Store in Festival Walk, Hong Kong on February 11, 2008 | Photo: Wikipedia/WiNG/H&M Festival Walk Store/CC BY 3.0
H&M TO CLOSE STORES
Closing down 250 stores means only 5% of its shops will be gone. The company, like many other stores, had to temporarily close its shops when the virus first hit.
The retailer had around 80% of its stores closed down during that period. On Thursday, the company released a statement about the upcoming store closures saying:
"More and more customers started shopping online during the pandemic.”
3RD QUARTER PERFORMANCE
From June to August 2020, the retailer’s third quarter, H&M was able to recover its sales. Stores reopening and profitable growth via online shopping led to this recovery.
H&M isn’t the only retailer that has announced possible store closures.
However, this month sales declined by 5% compared to the same month a year ago. The retailer’s CEO Helena Helmersson gave an update on the brand’s status going forward.
STATEMENT BY CEO
In a press release, Helmersson said: "Although the challenges are far from over, we believe that the worst is behind us and we are well placed to come out of the crisis stronger.” H&M isn’t the only retailer that has announced possible store closures.
Their rival, Zara, owned by Inditex, revealed earlier this year that it also plans to close several stores. The company shared that 1,200 stores would close down from this year until 2021.
OTHER RETAILERS AFFECTED
Other retailers that have been disrupted by the online shopping trend include GameStop and American Eagle Outfitters. The companies recently announced that they too had plans to close hundreds of stores.
In the UK, Britain is also struggling to keep its stores open amid the pandemic. The country’s high streets were said to be struggling to recover financially.
UK RETAILERS CLOSED DOWN
Earlier in the year, the retailers were forced to close down as they were non-essential shops when the pandemic landed. In late September 2020, Prime Minister Boris Johnson encouraged people to work from home where possible.
He also introduced new measures to try and curb the spread of the coronavirus. Retailers in the city centers have been left hanging by a thread as they fail to make profitable sales.