AUSTIN, TX — Sweden-based H&M, a low-cost fashion retailer with five Austin-area stores, announced plans to close up to 250 stores next year given diminished foot traffic amid the coronavirus pandemic as a primary cause.
The announcement by parent company H&M Group came in an earnings summary released Thursday.
In September alone, officials noted, sales decreased by 5 percent. Third quarter-sales fell by 16 percent to $5.7 million., according to the earnings report. H&M currently has 166 stores, or about 3 percent of its total number of stores, still closed. At the peak of the pandemic, about 80 percent of H&M’s 5,000 stores worldwide were closed.
“The rapid changes in customer behavior have been accelerated by Covid-19,”company officials wrote in an earnings report. “The H&M group is therefore now stepping up the pace of its transformation work further, with digital investments, optimization of the store portfolio and increasingly integrated channels.”
H&M officials said about a quarter of its stores have a contractual right to renegotiate or exit their leases each year and put the potential closure total at 250 stores.
Specific closures were not disclosed in the earnings report.
“More and more customers started shopping online during the pandemic, and they are making it clear that they value a convenient and inspiring experience in which stores and online interact and strengthen each other,” H&M CEO Helena Helmersson said. “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.”
The company operates a handful of stores in the Austin area, including:
Lakeline Mall, 11200 Lakeline Mall Dr., Cedar Park, Texas.
The Domain, 11410 Century Oaks Terrace.
Hill Country Galleria, 12912 Hill Country Blvd., Suite D2-145.
Tanger Outlet San Marcos, 4015 Interstate 35 frontage road, San Marcos, Texas.
Killeen Mall, 2100 South W S Young Dr., Suite 1090, Killeen, Texas.