The coronavirus pandemic is currently affecting the world badly now even more than you may think. It doesn't just cause trauma, depression, and fear among people in every corner of the world. It is not just the culprit of millions of sufferings and thousands of deaths around the globe. It is not just the reason for possible conflicts and divisions among nations in the future. It is also the main cause of most business closure nowadays.
Zara, a Spanish clothing company based in Arteixo in Galicia, has recently announced their plans of closing some of its stores due to the COVID-19 pandemic. Considered as one of the largest apparel retailers in the globe, the company is shutting down 1,000 to 1,200 physical stores worldwide, as reported by WSJ.
There is still no information about what locations will be affected or the exact date of its closure just yet. What is certain is that the plans will slowly unfold within the next two years. The resources used for these stores will then be used to improve online sales strategies.
As the company rolls out its plan, it will also increase the number of dedicated personnel who will be assigned for packaging and online customer service for both physical and online stores. The team will also focus on improving their online services so that customers can use its platform with ease no matter what kind of gadget they are using or wherever place they are in.
The plan is estimated to cost a total of about $2.7 billion, which will be allotted for the next three years. One billion dollars of which will be budgeted for the expenses that will be incurred for the creation of the online platform. The remaining budget will be for the upgrading of these online stores so it could be backed up with the most advanced technology solutions, as reported by Glamour.
This move is the company's response to the effects of the coronavirus pandemic on their businesses at present. Their physical stores lost a total of about $460 million sales, just within February to April. This was said to be because of the implementation of social distancing and isolation mandates of most countries nowadays. Their online shops however gained 50% sales as compared to last year.
Aside from Zara, other stores that have recently announced its closure are Guess, Signet Jewelers, and The Children's Place. Victoria's Secret, JCPenny, and Gap are also following Zara's footsteps and will just close a couple of their physical stores.
