The coronavirus fears the closure of Adidas stores in China – Footwear News
Adidas is the latest brand to announce precautionary measures in the face of the coronavirus outbreak in China. On Wednesday, the company announced the temporary closure of a “considerable” number of stores across the country.
While the German sportswear company said it was “too early to assess the magnitude” of the effect the closures will have on its business, other brands have started releasing estimates. Also on Wednesday, Capri Holdings – the parent company of Michael Kors, Versace and Jimmy Choo – said it expects to lose $ 100 million this quarter due to the public health emergency, which has so far killed nearly 500 people and sickened more than 24,500, mostly in China.
With tens of millions of Chinese residents stranded and air travel inside and outside the country largely suspended, business has slowed to a trickle in many cities. Capri Holdings said it has closed 150 of its 225 stores in mainland China; the others operate with reduced hours and “significant drops in customer traffic”. The company also warned that the impact could worsen if the situation worsens and Chinese tourism is further restricted.
As for Adidas, the brand has around 12,000 stores in China, 500 of which are owned. The region generated significant growth for the brand this year, with sales up 11% in the three-month period ended September 30 and 14% in the second quarter.
Rival Nike said on Tuesday it was temporarily closing about half of its stores in China, adding in a statement that it “prayed for the health and safety of our teammates and partners” and cut hours at stores that remain open .
“First and foremost, our thoughts are with those affected and we remain focused on the health and safety of our teammates and partners,” Nike Inc. President and CEO John Donahoe said in a statement. “Despite this difficult situation, Nike’s long-term opportunity to continue to serve Greater China consumers with inspiration and innovation remains extremely strong. At the same time, we continue to have extraordinary brand dynamics and activity in all other geographies. “
Greater China accounted for $ 1.68 billion of Nike’s $ 10.66 billion in revenue last quarter, with sales in the region rising 22% year-over-year.