In a last possible attempt to buy the giant retailers¡¯ goods from stores in their country, Russians are snapping up western fashion and furniture this week as H&M and IKEA sell off the last of their inventory in Russia. The two retail giants are moving forward with their exit from the country after it sent troops into Ukraine.
Sweden-based H&M and Netherlands-based IKEA had earlier paused sales in Russia after the military operation began and are now looking to unload their stocks of clothing and furnishings as they shut down operations in the country, saying the future is unpredictable, as per Associated Press (AP).?
IKEA¡¯s sales are currently reported to be online only after stores shutdown, while the H&M store at the Moscow shopping mall Aviapark reportedly saw a steady stream of young shoppers on Tuesday this week. The racks and shelves were well stocked in the clothing retailer.?
¡°I will start looking at Russian brands,¡± one H&M shopper, who gave only her first name Anya, said after emerging from the store. Another shopper, who only gave his name as Leonid, reportedly said he was ¡°very hurt¡± that H&M is closing down: ¡°A good store is leaving.¡±
Both companies are laying off staffers as they scale down business in Russia. The report mentioned that H&M said on Tuesday that 6,000 workers will be affected and that it was working on details of offering continued support in the coming months.
Earlier, IKEA had said in June that many workers will lose their jobs and it has guaranteed six months of pay for them, as well as core benefits. It had recently said this week that it has 15,000 workers in Russia and Belarus, but it did not immediately confirm how many would be laid off.
Besides these two giant retailers, many Western companies had promised to leave Russia after it sent troops into Ukraine, taking months to wind down operations and often selling holdings to Russian firms. McDonald¡¯s sold its 850 restaurants to a Russian franchisee owner, whereas British energy giants Shell and BP are taking billions of dollars in charges to exit investments and holdings in Russia.
On the other hand, companies like PepsiCo, Nestle and drugmaker Johnson & Johnson are reportedly supplying essentials like medications and baby formula while halting nonessential sales.
H&M said it expects costs from leaving Russia to reach about two billion Swedish kronor ($197m), which will be included as one-time costs in its third-quarter earnings this year.
IKEA had said in June that it will start looking for new owners for its four factories in Russia and will close its purchase and logistics offices in Moscow and Minsk, Belarus, a key Russian ally.
Also Read:?IBM Winds Up Entire?Business?In?Russia, Starts Laying Off Employees
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