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H&M Permanently Exits Russia, But will Sell of Stock First

Image Source: BBC

Despite having stated that it would leave Russia, H&M will briefly reopen its stores there in order to liquidate its remaining inventory.

H&M, the second-largest apparel retailer in the world, claimed that the war in Ukraine made it “difficult” for it to continue operating there.

Following Russia’s invasion of Ukraine in late February, the Swedish company abruptly stopped all sales there in March. In Russia, H&M reportedly employs 6,000 people across more than 150 outlets. However, no date or timeframe for its departure has been provided.

There was an announcement by the CEO, Helena Helmersson. Saying that it was “difficult” given the circumstances to continue doing business in Russia.

In recent months, a lot of companies have left Russia, including H&M. Many people claim that the restrictions put in place following the invasion by Western allies have rendered trading unprofitable. And, in some sectors, impossible. Others have quit because they feel the conflict is morally wrong, or they are doing it because customers are pressuring them to.

Russian sales made up around 4% of the group’s total sales in the fourth quarter of 2021, making it the sixth-largest market for H&M before it stopped selling there. According to its 2020 annual report, the retailer now operates around 150 stores in Russia; however, all of these locations will be closing due to the conflict.

Since beginning operations in Russia in 2009, the global fashion powerhouse has been growing there. Recently, stores bearing the Weekday and & Other Stories identities were opened. Previously,  the Russian consumers could order Monki and Cos clothing.

The cost of leaving Russia, according to H&M, is expected to be around two billion Swedish Krona. Due to worries for the staff’s and customers’ safety, the retailer’s stores in Ukraine have been not open for some time.

The wave of exiting Russia continues

Due to the invasion of Ukraine, H&M declared in March that it would temporarily halt all sales in Russia, expressing its worry about the actions taking place in Ukraine. However, in a formal statement, the Swedish store stated it supports “all the people who are suffering.”

In speaking out against Russian President Vladimir Putin’s invasion of Ukraine. It joins a number of other significant businesses, like fast fashion retailers Asos who also declared in March that they would stop doing business in Russia.

Read Also: Marriot leaves Russia after 25 years

A representative for Asos stated on Wednesday that the company has determined it was neither viable nor moral to continue doing business in Russia. Therefore, given the ongoing conflict.

Despite the fact that shoppers in Russia may no longer order their products online. Boohoo and the shoe manufacturer Nike did not expressly address the conflict at the time.

As a result of its “great concern” and support for people “suffering as a result of the violence,”. Apple has also halted all product sales in Russia.

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