H&M group to close 170 stores worldwide

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30th June 2020 – (Hong Kong) The brick-and-mortar side of the retail scene is set to worsen, with Hennes & Mauritz AB planning to add to the wave of store closures. The Swedish fast-fashion retailer, which owns Cos, Monki, Weekday and & Other stories, as well as its namesake chain, plans to close around 170 stores while emphasizing larger flagships — outfitted with state-of-the-art garment tracking technology. However, they will open another 130 new stores and hence only 40 stores will be closed subsequently if the new stores are taken into account. It aims to accelerate the integration of online channels, and is using RFID tracking technology in 20 markets.

The brand has increased its online customer base with many of its in-store customers now becoming multichannel customer. The group aims to adopt the omnichannel strategy in future to meet the customer wherever they choose to go. H&M reported a first-half loss after tax of 3.06 billion Swedish kroner, or $328 million. Executives flagged a faster recovery rate in recently reopened stores. The brand’s sales in June declined by 25 per cent in local currencies compared to the same period last year. Most of the label’s stores have reopened, but 350 units, or 7 percent, remain closed.

Earlier this month, the Swedish firm reported sales of 83.61 billion Swedish kronor, or $8.96 billion, for the first half, down 24 percent in local currencies, with the strongest impact from the COVID-19 crisis felt in the second quarter.

The group’s inventory decreased 3 percent year-on-year in local currencies at the end of May, compared to a rise of 2.5 percent at the end of April, which was a positive surprise, noted analyst Chamberlain who had expected an increase due to delayed shipments from China and Bangladesh.

Source: https://www.fashionatingworld.com/

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