Skip to main content
BoF Logo

The Business of Fashion

Agenda-setting intelligence, analysis and advice for the global fashion community.

H&M Group Reports Dramatic Sales Decline in China as It Closes More Stores in Europe

The fast fashion giant is grappling with a significant business slowdown in China and has temporarily shuttered stores in Italy, France and Spain, as governments act to contain the spread of Covid-19.
H&M门店 | 图片来源:Shutterstock
By
  • Sarah Kent

LONDON, United Kingdom — H&M group has temporarily shuttered stores across large parts of Europe, as governments take extraordinary measures to try and contain the escalating coronavirus pandemic.

The closures signal more pain ahead for retailers, already suffering the aftershock of a widespread shut down in January and February across China, the first country hit by the outbreak.

H&M group said overall sales still rose 5 percent in local currencies in the period from 1 December to 29 February. In China, sales were trending up 27 percent year-over-year, but after a spate of store closures beginning late January, sales plummeted. Overall, sales in China were down 24 percent in the first quarter. At its peak, the company shut 334 out of the group’s 518 stores in the country — a stark warning of what may be about to play out elsewhere.

As the pandemic continues to spread, governments are taking extraordinary measures to try and contain the virus. A growing number of cities and countries are on lock down, with only essential stores allowed to remain open.

ADVERTISEMENT

Over the last few days, H&M group said it has temporarily closed all stores in Italy, Poland, Spain, the Czech Republic, Bulgaria, Belgium, France and parts of Greece. As of Monday it will also close all stores in Austria, Luxembourg, Bosnia-Herzegovina, Slovenia and Kazakhstan. Meanwhile, the company said sales in China have gradually started to recover.

The crisis comes at a delicate time for the fast fashion giant. H&M group is in the middle of a years-long turnaround effort that is just beginning to bear fruit. In January, the company reported its first rise in annual profit since 2015 and named company veteran Helena Helmersson CEO.

Since then, global events have moved rapidly. Retailers are grappling with how to manage the mounting health crisis and the associated disruptions to day-to-day business, supply chains and consumer sentiment. H&M group will provide further updates April 3 with its quarterly report.

“All activities in the company are now being carefully evaluated — including from a cost and risk perspective — so as to be able to mitigate the negative effects associated with the virus as far as possible,” the company said in a statement.

We’re tracking the latest on the coronavirus outbreak and its impact on the global fashion business. Visit our live blog for everything you need to know.

Related Articles:

Coronavirus is Already Changing How People Shop. Here's How.Opens in new window ]

How to Talk to Customers During the Coronavirus PandemicOpens in new window ]

Coronavirus Updates: More Stores Closed, LVMH Switches From Fragrance to Hand SanitiserOpens in new window ]

© 2024 The Business of Fashion. All rights reserved. For more information read our Terms & Conditions

More from Retail
Analysis and advice from the front lines of the retail transformation.

How Rent the Runway Came Back From the Brink

The rental platform saw its stock soar last week after predicting it would hit a key profitability metric this year. A new marketing push and more robust inventory are the key to unlocking elusive growth, CEO Jenn Hyman tells BoF.


Why Esprit’s Ambitious Rebrand Fell Short

The company is in talks with potential investors after filing for insolvency in Europe and closing its US stores. Insiders say efforts to restore the brand to its 1980s heyday clashed with its owners’ desire to quickly juice sales in order to attract a buyer.


How Adidas Sambas Took Over the World

The humble trainer, once the reserve of football fans, Britpop kids and the odd skateboarder, has become as ubiquitous as battered Converse All Stars in the 00s indie sleaze years.


view more

Subscribe to the BoF Daily Digest

The essential daily round-up of fashion news, analysis, and breaking news alerts.

The Business of Fashion

Agenda-setting intelligence, analysis and advice for the global fashion community.
CONNECT WITH US ON
The Business of Beauty Global Awards - Deadline 30 April 2024
© 2024 The Business of Fashion. All rights reserved. For more information read our Terms & Conditions, Privacy Policy, Cookie Policy and Accessibility Statement.
The Business of Beauty Global Awards - Deadline 30 April 2024