November 30, 2020

TPT News

Voice Of India

Zara owner to CLOSE DOWN 1,200 stores globally due to Coronavirus; Asia and Europe to be most affected

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Zara’s parent company Inditex made the announcement earlier. The brand is struggling with sales due to the pandemic.

The Covid-19 pandemic has hit all sectors of society. Some of the biggest names in the fashion industry too, seem to have taken a huge hit due to the chaos, sudden drop of sales due to lockdowns and more. Spanish apparel retailer Inditex, that owns brands like Zara, Berksha, Massimo Dutti and more, made the announcement . 

Inditex announced that it would be ‘absorbing’ around 1,000 to 1,200 of its smaller stores that witnessed bigger losses. The brand would concentrate on older shops from brands other than Zara which could mean that Berksha, Massimo Dutti and Pull & Bear would be affected by this decision. The closure of stores is most likely to be expected in Europe and Asia while the parent company also announced that the ‘headcount will remain stable’, meaning the staff would be offered roles in jobs involving online purchases and dispatches. 

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The retailer Inditex, parent company of Zara and others, was said to be one of the worst hit companies during the pandemic. The sales dropped down to 44% between just February 1 and April 30 and the company reported a net loss of 409 million Euros during this first financial quarter. A quarter of the company’s shops still remain closed as of June 8. 

With this announcement, the number of stores owned by the brand will fall from 7,142 to around 6,700 once the ‘reorganisation’ takes place. 

What are your thoughts on this news? Are you a fan of these stores? Let us know in the comment section below.