H&M Boss Announces Permanent Closure in Indonesia, Here's the Fate of Its Stores
Jakarta, CNBC Indonesia - News of the closure of stores of the Swedish fashion retailer H&M has caught the attention of retail players. It is reported that H&M will close 160 of its stores worldwide this year.
The General Chairman of the Indonesian Retailers and Shopping Centre Tenants Association (Hippindo), Budihardjo Iduansjah, acknowledged that the Swedish fashion retailer will exit and close its stores in Indonesia. However, according to him, the closure of H&M stores is not because shopping spaces are being abandoned, but rather a brand replacement in the same location.
He stated that the closed H&M stores will generally be immediately filled by other brands.
“H&M is indeed closing its stores, but the former locations are filled by brands held by operators. There are brands, so the stores are changing brands, that’s what I heard,” said Budihardjo to CNBC Indonesia, quoted on Saturday (30/4/2026).
Budihardjo emphasised that this dynamic is a normal occurrence in the retail industry.
“In retail, things like store renovations, store shrinkage, store expansion, store closures, store openings are part of the strategy. Where there is still purchasing power or consumer behaviour, where people still want to shop and there are still many sales, those will be opened,” he explained.
Meanwhile, the General Chairman of the Indonesia Shopping Centre Managers Association (APPBI), Alphonzus Widjaja, stated that H&M’s global business, which is experiencing difficulties, is also contributing to H&M’s performance in Indonesia.
“H&M’s business globally is indeed experiencing difficulties that also impact performance in Indonesia,” said Alphonzus when contacted separately.
However, he declined to provide further comments regarding the closure of H&M stores.
Global Trend: Hundreds of Stores Closed
Citing The Sun, H&M has previously closed 163 stores worldwide and plans to close another 160 stores this year, then shifting business focus to e-commerce and investments in the most profitable locations.
Throughout the first quarter of this year, the Swedish fashion retail giant was reported to have recorded a profit decline while adjusting its business to online and cutting some stores.
“Optimisation of the store portfolio has a somewhat negative impact on first-quarter 2026 sales, due to store closures and rebuilds,” H&M stated in their revenue report, quoted from The Sun.
“However, for the full year 2026, the sales effect from store optimisation is expected to be slightly positive,” it added.
The company explained that this step is taken to improve efficiency, including boosting margins per square metre and reducing operational costs.
This phenomenon also reflects changes in global consumer behaviour.
“Buyers now prioritise value more, shop more online, and are less loyal to traditional physical stores,” said CEO of Retail Tech Media Nexus, Dominick Miserandino, previously to The U.S. Sun.
“That’s why we see so many companies stumbling. The economic conditions are tough,” he added.
Major Discounts on H&M Website
Amid these adjustments, H&M also appears aggressive in pushing digital sales. Based on monitoring by CNBC Indonesia on its official site, the company is featuring major promotions such as “Buy 2 Get 1 Free” in its payday deals programme.
This promotion is one way to attract consumers, along with the shift in shopping patterns to online channels.