Weekly sales data from H&M China shows that while stores are slowly recovering from the peak of the pandemic in Mainland China, there has clearly not been an immediate bounce back. H&M China’s sales declined by 79 per cent in week 10 despite 89 per cent of its stores in the country being open, raising the question whether this is a financially viable strategy in other affected markets due to the burden on operating costs.

Nearly all retailers have reopened stores but consumer propensity to spend is significantly higher than in mature retail markets such as the US and much of western Europe so we expect store reopening schedules and the recovery process to be longer than what we have witnessed in China.

According to Global Data, these retailers must start planning a recovery strategy for each country they operate in, taking into account consumer sentiment and confidence, the country’s financial stability, consumer propensity to spend on fashion, online penetration and the time in the season and promotional calendar.

Some retailers may need to consider whether consumer demand after the pandemic’s peak will be sufficient to warrant reopening all stores in any one market at once.