Ikea temporarily closes stores in Ireland and the UK as virus spreads

Ikea is to temporarily close its stores in Ireland and the UK to guard against the spread of the coronavirus.

The Swedish flat-pack furniture retailer’s flagship store in Ireland at Ballymun, and its order and collection outlet in Carrickmines in south Dublin, will close until further notice, but online sales and deliveries will not be affected.

Eason, meanwhile, has said it will keep its shops open, despite the spread of the coronavirus, and will constantly review the policy. The bookseller, stationer and newsagent has 60 shop, 20 of which are franchised.

“As workers, students, parents and children are increasingly operating from their homes, Eason stores remain open, maintaining a supply of articles for home working. We will keep this situation under constant review and will continue to consider additional measures as this challenging situation continues to evolve,” it said.

Clothing retailer Next said it is braced for a revenue hit, but said it could sustain a hit from the coronavirus of more than €1.1bn, or 25% of annual sales, without exceeding its debt and bank facilities.

The group, which has about 700 stores, with about 500 of those in Ireland and the UK, and also operates its online directory and catalogue business, said uncertainty around the scale, timing and impact of the pandemic means it is impossible to give meaningful guidance for profit in 2020 to 2021. Next said it was preparing for a significant downturn in sales. Total brand sales were down 30% from March 15 to 17, with sales at stores down 46% and online down 25%.

Next noted that to date, homeware and childrens wear sales appeared to be less affected than adult clothing. The group said online sales were likely to fare better than stores but would also suffer significant losses.

“People do not buy a new outfit to stay at home,” said chief executive Simon Wolfson. However, he said a long-term effect of the virus could be to speed up business moving online.

“We’ve been coping with the transformation from stores to online for many years. There’s a possibility that the coronavirus will accelerate that process,” he said.

The group said the virus has had some effect on its supply chain, though as yet the only meaningful delays have come from suppliers based in mainland China. Mainland China accounts for 27% of Next’s supply base, excluding third-party brands.

Burberry said sales in the final weeks of March would plunge by up to 80% as the impact of coronavirus already seen in China spread to Europe and the US, causing stores to close and luxury shopping to dry up.

The British brand said like-for-like sales in the final weeks of its financial year to March 28 would be down 70% to 80%.

Additional reporting Reuters