Clothing retailer, H&M to close 250 stores next year due to COVID economy
A COVID-19 induced uptick in online shopping at the expense of in-person retail is forcing H&M to close 250 of its stores in 2021.
According to CNN, the fast-fashion retailer has 5,000 stores worldwide, so Thursday's announcement accounts for 5% of its total store count.
"More and more customers started shopping online during the pandemic," following temporary store closures that, at its peak, totaled about 80% of its store count, H&M said in a statement Thursday.
The Sweden-based clothing retailer reported that its third quarter reflected growth from June to August as stores reopened and an increasing number of customers began shopping via the company's online store. Despite this positive report, September sales declined 5% compared to the same month a year ago.
"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," CEO Helena Helmersson said in release.
With novel coronavirus prompting more consumers to ditch in-person store visits for online shopping, brick and mortar retailers have been hard hit. CNN reports that Inditex, which owns Zara and other fast-fashion brands, said earlier this year it plans to close as many as 1,200 stores this year and next.
Similarly, American Eagle Outfitter and GameStop also recently announced plans to close hundreds of stores because of the rise of online shopping.
According to one study, online shopping is growing so fast that the global online shopping market size is predicted to hit 4 trillion in 2020.
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