Apparel groups reduce number of stores and lay off staff

The pandemic is bringing new changes to the country’s commercial map, as the shifts in consumer habits have not only affected the economic performance of retail commerce in the last 14 months, but also the strategy of the sector’s enterprises in the coming years.

The traditional subsectors of retail, such as those of clothing and footwear, are resorting to restructuring their networks, which means job cuts and even some store closures. Market professionals say that phenomenon will grow in the coming months, especially from this fall, when enterprises will have counted their takings from the tourism season that everyone hopes will be better than last year.

The Inditex group (Zara, Bershka, Stradivarius, Pull&Bear, Oysho, Massimo Dutti), which has a commanding position in the Greek clothing market too, will shut down some points of sale, or replace them in some cases with fewer and bigger ones; this is a practice that meets the new pandemic-dictated requirements for stores of greater area.

Therefore the group has already shuttered two Oysho stores in Trikala and Karditsa and its Massimo Dutti store in Kifissia. These points have not been replaced yet, and consumers are effectively being asked to be served by the upgraded online stores.

The Spanish multinational clothing company has also closed two Bershka stores in Thessaloniki, which have been replaced by a larger one on Tsimiski Street of a total area of 1,500 square meters. It renovated its store in Iraklio in 2020, which now boasts a sales area of 2,220 sq.m. and applies new technologies in the context of its philosophy for a multichannel purchase experience.

The other major apparel chain, H&M, may have maintained the same number of stores last year, but it inflicted a major staff cut amounting to about 20%, or 896 employees, in 2020 from 1,117 in 2019. In the period from December 2020 to February 2021 its sales in Greece dropped 50% year-on-year.

Kloukinas-Lappas has closed some stores bearing the Mothercare and Early Learning Centre (ELC) brands, as the sector of children’s and baby apparel posted a major decline, having missed out on the Easter and Christmas periods in 2020, while the pandemic restrictions resulted in the cancellation, postponement or trimming down of christening receptions, leading to a slump in gift sales.

In January the company closed its ELC shop at The Mall Athens and another in Romania, while it recently announced it will shut its Mothercare shop on Ermou Street in central Athens and lease the property to Adidas sportswear for 64,000 euros per month. The company’s priorities are larger investments in e-commerce, the maintenance of large regional stores and smaller points of sale on high streets.

The strategy of smaller stores is also the choice of the Fourlis group for IKEA stores, as this year it will develop a city IKEA in central Athens, after the one it has opened in Piraeus, and reduce the size of those in Larissa and Ioannina, which never made profits.