As the coronavirus health crisis has moved more consumers online, H&M has indicated that it intends to reduce its worldwide brick-and-mortar footprint by 250 shops. The closures for the second-largest fashion retailer around the globe will occur in 2021, BBC reported.
The retailer can reportedly conclude or rediscuss leases on approximately 25 percent of its retail locations each year. It said it intends to make a "net decrease of around 250 stores” in 2021.
H&M has 5,000 brick-and-mortar retail locations globally, but the BBC indicated that the number of closures that will occur in Britain is unknown.
To contend with increasing digital demand, H&M said it would increase its efforts to bolster digital investment. The Swedish company said it had engaged in “rapid and decisive action” to handle the effects of COVID-19, including modifications to purchasing, financing, staffing and property-related processes.
Chief Executive Helena Helmersson said, per the BBC, "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.”
Furthermore, GlobalData’s Sofie Willmott indicated that the retailer’s sales last month "fell just 5 percent demonstrating the relevance of its product offer as shoppers start to feel more confident returning to stores.”
Helmersson previously said that sales had started to recover at a quicker pace than expected as it has reopened in stores. “To meet the rapid changes in customer behavior caused by COVID-19, we are accelerating our digital development, optimizing the store portfolio and further integrating the channels,” she said at the time.
A study found that the coronavirus is forecasted to close roughly 50 percent of the department stores anchoring U.S. malls by the close of 2021. The Green Street Advisors poll noted that approximately 1,000 malls exist in the United States, and approximately six in 10 of them showcase big department stores like Macy’s.