Destroyed By The COVID-19 Pandemic, H&M Will Close 350 Stores All Over The Country

H&M outlet. (Photo: Doc. Mall Grand Indonesia)

JAKARTA - The Swedish fashion company Hennes & Mauritz AB (H&M) is rumored to be closing 350 stores across the country until the end of 2021. This step is because the company is experiencing great pressure from the effects of the COVID-19 pandemic, which is still spreading today.

H&M Chief Executive Officer Helena Helmersson said that although sales were currently at normal levels like in 2019 or before the COVID-19 pandemic, the policy of closing the outlets would still be taken.

Furthermore, Helena reasoned that this was because the company had to suffer a loss of 500 million euros in 2020. This loss was also due to the decreased turnover due to the COVID-19 pandemic.

"In the second quarter of 2021 H&M sales rose 75 percent to 46.5 billion Swedish kronor or the equivalent of 4.6 billion euros. However, 140 stores were still closed at the end of the period due to COVID-19", said Helena, quoted by retaildetail.eu, Wednesday, July 7th.

Helana said that business continuity until now still depends on online or online sales. He admitted online sales increased 40 percent with a net profit of 2.7 billion Swedish kronor, equivalent to 270 million euros.

According to Helena, sales seem to have recovered in the first 28 days of June 2021. The company's revenue has also increased by about a quarter.

"We are almost back to our pre-pandemic levels. However, at the moment, around 90 shops are still temporarily closed", he explained.

Helena said the full plan in 2021, H&M will close about 350 stores. However, said Helena, if the situation improves, it will open 100 new stores.

"100 new stores will be added when the company's financial condition begins to recover and sales increase. So the net reduction of outlets will be around 250 units", he said.

For your information, this Swedish fashion retailer has also announced that it will close 170 stores worldwide in 2020, or about 40 percent of its stores. The exact affected locations have not been announced.

H&m reported a 50 percent drop in sales during the second quarter of 2020. As stores were closed during worldwide lockdowns.

Not only H&M, but Victoria's Secret also plans to permanently close 250 stores in the US and Canada in the coming months. This will happen until at least 2022.

"There will be more in 2021 and maybe a little more in 2022", said Victoria's Secret Chief Financial Officer, Stuart Burgdoerfer, Tuesday, December 1, 2020.