Fashion giant H&M to close 250 stores globally as shoppers move online during lockdown
- Cheap fashion chain said sales remain 5% lower than at same point last year
- H&M’s total sales fell by 16% to £4.4bn in the last quarter, figures show
Fashion giant H&M is closing 250 of its stores globally next year as the Covid-19 pandemic continues to accelerate a major switch to online shopping.
H&M, which is the world’s second biggest clothing retailer, said that around a quarter of its 5,000 stores are able to renegotiate or exit contracts next year, allowing it to shut around five per cent of its shops for good.
The locations of the shop closures, how many jobs will be axed and whether or not any UK stores will be affected, remains unclear.
The update came as the Swedish company said it had seen trading continue to recover in September, but sales remained 5 per cent lower than at the same point a year ago.
Shutting shops: Fashion giant H&M is closing 250 of its stores globally next year
H&M’s total sales fell by 16 per cent to £4.4billion for the quarter to August.
Around 900 H&M stores were closed to customers at the start of the period amid global lockdown restrictions.
By the end of the last quarter, around 200 H&M stores around the world remained shut, the group said today.
The retailer also reported that its pre-tax profits fell to £210million for the nine months to 31 August, beating analyst expectations.
H&M said it had taken ‘rapid and decisive action’ to manage the impact of the virus, addressing this with changes to purchasing, investments, rents, staffing and financing.
The company said it was stepping up its transformation plans with increased digital investment after seeing shopper demand rise across its websites.
Helena Helmersson, chief executive of H&M, 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.
‘Demand for good-value, sustainable products is expected to grow in the wake of the pandemic and our customer offering is well positioned for this.
‘We are now accelerating our transformation work so that we continue to add value for our customers.’
On its UK website, H&M says higher demand from shoppers meant its deliveries were taking longer than normal to arrive at people’s homes, with an estimated wait time of between six to eight days.