H&M plans to close 170 stores worldwide amid coronavirus pandemic

H&M is planning to close 170 stores worldwide after experiencing a drop in sales amid the coronavirus pandemic.

After many of the fashion retailer's stores were forced to close due to mandated shutdowns, the company has experienced a 50% drop in sales during the company's first quarter.

There were initially plans to close 130, but plans have shifted to increase that number as sales have continued to fall.

"Covid-19 continues to impact people, communities and companies around the world and I am full of admiration for our employees' commitment, drive and perseverance during this very challenging time. The safety of our employees and customers remains our highest priority and we are reopening stores in line with decisions by the authorities," H&M CEO Helena Helmersson said in a released earnings statement.

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She continued, "Before the pandemic hit, we performed strongly – a result of many years of long-term investments to create the best offering for our customers and to meet the digital shift in the industry. This, combined with the fact that we have acted quickly to counter the negative effects of Covid-19 and that we are speeding up the transformation of the H&M Group, makes me convinced that we will come out of the current crisis stronger."

While net sales have decreased at physical locations, there has been an increase in the fast fashion giant's online sales by 36%, and the company has expressed that there will be a shift to put more focus on e-commerce efforts.

"During the pandemic it became clear how important it is that the digital and physical channels interact to meet customers’ needs. When the majority of the stores were temporarily closed in the second quarter, we focused on redirecting product flow to our digital channels, which remained open at all times in nearly all our online markets," said Helmersson.

H&M joins Lucky Brand, Victoria's Secret, J.C. Penny and several other labels that have announced store closures or bankruptcies this year.