Economic consequences of the global pandemic have been unprecedented in its global reach and impact and not only towards SMEs but also to multinational brands. BMG has looked at international brands, well-known to Georgians that became casualties of the Covid-19 pandemic.
The world's second-biggest fashion retailer, Sweden's H&M, says it plans to cut 250 of its stores globally. The closures will come next year after the firm said the Covid-19 pandemic had moved more shoppers online.
Although it said sales had continued to recover in September, they were still 5% lower than the same month in 2019. The firm has 5,000 stores worldwide.
Esprit has revealed that it will be closing down all of its Asia stores outside China—namely Malaysia, Singapore, Taiwan, Hong Kong, and Macau. The 56 stores in the five countries only account to less than 4 per cent of the brand’s sales, and the slump in sales over the last nine months was further hit by the pandemic.
American retailer Guess will be closing 100 stores (around 9 per cent of its total amount) over the course of the next 18 months. The closures will primarily be affecting stores in North America and China. Although its CEO Carols Alberini mentioned that this decision came about as many of the leases are ending, the pandemic undoubtedly played a huge part. The brand’s sales reportedly fell by over 50 per cent compared to last year’s.
In a move to focus on digital growth, Zara’s owner Inditex will be closing up to 1,200 stores (aka 16 per cent of its network) worldwide over the next three years and invest US$3 billion in its online operations. The group revealed that the fast-fashion retailer’s sales are down by a whopping 44 per cent compared to last year. The specific locations have yet to be revealed, but it will likely involve the group’s other brands including Pull & Bear, Bershka, and Massimo Dutti, buro247.my reports.
Victoria’s Secret is shutting 250 stores across the US and Canada, but its owner L Brands warned that more outlets might close in the coming two years. The brand currently has over 1,000 boutiques in those two countries.
The popular footwear brand from Canada- ALDO - has filed for protection from creditors in the US and Canada to save its business. They decided to conduct a restructure so they could continue serving customers.
Pursuant to the Company’s CEO, “it is no secret that the retail industry has experienced rapid and significant change over the last several years. We were making strong progress with the transformation of our business to tackle these challenges; however, the impact of the COVID-19 pandemic has put too much pressure on our business and our cash flows. After conducting an exhaustive review of strategic alternatives, we were determined that filing is in ALDO’s best interest to preserve the Company for the long term and survive through this challenging period.”
