Hennes & Mauritz AB, the Swedish MNC clothing-retail company known for its fast-fashion clothing for men, women, teenagers & children, has announced the closure of 250 stores globally next year as it plans to ramp up its digital e-commerce business.
As of November 2019, H&M operates in 74 countries with over 5,000 stores under the various company brands, with 126,000 full-time equivalent positions. It is the second-largest global clothing retailer, behind Spain-based Inditex.
The shares of H&M rose more than 7 percent after the company said online sales were on the upswing and the returned to profit in the third quarter.
Commenting amongst the ongoing COVID 19 pandemic, its chief executive Helena Helmersson said,” More and more customers started shopping online during the pandemic, and they are making it clear that they value a convenient and inspiring experience in which stores and online interactions and strengthen each other.”
The company further commented that it was working to improve its supply chain to increase the availability of inventory and the speed of deliveries.
H&M reported that at the beginning of the third quarter, roughly 900 of its 5,000 stores were temporarily closed, as COVID 19 hit the retailers hard. Lockdowns further aggravated the situation as it leads to unpaid rents and staff furloughs, and by the end of the quarter ending Aug. 31, over 200 stores were still temporarily shut.
Ms. Helmersson however concluded on a positive note saying, “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.”
