We've lost some of our favorite businesses as a result of the COVID pandemic: Big-name companies like Lord&Taylor, Fry's Electronics, Pier 1 Imports, and Stein Mart permanently closed all of their stores over the last two year, while others had to shutter hundreds of locations. But even as COVID numbers have been declining, store closures are still a reality for businesses and consumers. In fact, one popular clothing chain just announced that it is planning to permanently shut down nearly 250 locations this year. Read on to find out what store you're about to see a lot less of.
H&M is closing 240 stores.
H&M just announced that it is planning to shutter 240 stores this year, Yahoo Finance reported on March 31. According to the news outlet, the Swedish retailer has about 4,800 stores globally, and the location of its closures have not yet been announced.
H&M's global sales rose 23 percent from Dec. 2021 to Feb. 2022, per Yahoo Finance. But this figure was still down 11 percent from where the company was two years ago just before the pandemic hit. During the recent quarter, H&M said it had been heavily impacted by the spread of Omicron, as well as "impacted by extensive restrictions" in some countries.
The company is also planning to open some new locations, too.
The Swedish retailer is planning to open 95 new stores this year as well, Yahoo Finance reported. According to the news outlet, this will result in a net decrease of around 145 spaces. "Most of the openings will be in growth markets, while the closures will mainly be in established markets," H&M said in a statement.
In 2022, H&M is expected to launch in six new markets, with one of these markets—Cambodia—having already opened this month. According to Yahoo Finance, the other markets will be Ecuador, Kosovo, North Macedonia, Costa Rica, and Guatemala. And in 2023, the company said it plans to open its first store in Albania.
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H&M recently paused operations in certain countries.
The recent closure announcement isn't the first time H&M has decided to shut down operations for some of its stores this year. Earlier this month, the company announced that it was temporarily pausing all sales in Russia in protest of the country's invasion of Ukraine, The New York Times reported.
"H&M Group is deeply concerned about the tragic developments in Ukraine and stand with all the people who are suffering," the company said in a statement, adding that it "cares for all colleagues and joins all those around the world who are calling for peace."
H&M also temporary closed all of its stores in Ukraine "due to the safety of customers and colleagues." Overall, the company's temporary closures have ended up affecting 185 stores in Russia, Belarus, and Ukraine, according to Yahoo Finance. And the retailer also stopped online sales in these countries.
The company just reported a significant decrease in sales growth.
H&M recently revealed that store closures in Russia, surging expenses, and new COVID disruptions have all hurt its business, The Wall Street Journal reported on March 31. H&M said that its store closures in Russia, Ukraine, and Belarus slowed sales growth in March to 6 percent from 18 percent in in its first quarter, which ended Feb. 28.
Until this point, Russia had high growth with the company as its sixth largest market and one of the most profitable. But as a result of the recent earning downfalls, Helena Helmersson, the chief executive of the company, told The Wall Street Journal that the company's future in Russia is now unclear. "It's too uncertain to say what will happen and what kind of decisions we will take," she said. "The obvious question for all companies now is about the future."