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H&M to close 350 stores in 2021, citing increase in online shopping

Fast-fashion giant H&M announced that it plans to close 350 stores in 2021 while opening 100 new stores — resulting in a net decrease of around 250 locations next year. 

The retailer was forced to close 80% of its locations due to the ongoing coronavirus pandemic, and according to a news release by the company, sales decreased in September of 2020 by 5% compared to the same month last year. 

“More and more customers started shopping online during the pandemic, and they are making it clear that they value a convenient and inspiring experience in which stores and online interact and strengthen each other,” said Helena Halmersson, CEO. 

Because the pandemic has resulted in an increase in contact-free shopping, especially e-commerce, the trend of retail shops closing continues.

RELATED: Amazon Prime Day 2020: What to know about the online sales event

The closures come as retailers kick off the holiday season earlier than ever this year in hopes of avoiding big in-store crowds and shipping bottlenecks in November and December. 

Stores like Best Buy, Macy’s and Target typically offer their biggest Black Friday deals over Thanksgiving weekend, but now they're starting them in October so people don’t crowd their stores later, creating a potentially dangerous situation during a pandemic.

And with more people expected to shop online, retailers are trying to avoid a rush of orders closer to Christmas, which could lead to late packages and more expensive shipping. 

Many had a hard time keeping up with the surge in buying when shoppers were locked down in their homes during the early days of the pandemic. Even Amazon, which has spent 25 years building warehouses and a delivery network, had to hire an additional 175,000 workers to meet demand.

The Associated Press contributed to this story.