H&M and Boohoo warn about supplies ahead of Christmas
Clothing and home retail chain Next warned earlier this week that consumers may have to wait longer to receive goods this holiday season.
Supply chain snags are hobbling European businesses as rising shipping costs, a growing energy crisis, and acute trucker shortages in Britain threaten their ability to meet surging demand heading into Christmas.
Online retailer Boohoo lowered its forecasts for sales and profitability, while H&M reported slowing revenue growth. Both blamed delays in deliveries and the higher cost of moving goods. Boohoo shares plunged as much as 17%.
The challenges facing the UK fast-fashion retailer and its rivals reflect the difficulties dogging many European businesses more than 18 months after the coronavirus pandemic took hold.
One of Britain’s largest clothing and home retail chains, Next, warned earlier this week that consumers may have to wait longer to receive goods this holiday season and could face price inflation next year.
The company’s £26m of shipping costs in the first half — higher than pre-pandemic levels — dented its profit outlook, he added.
The squeeze on deliveries has worsened recently as Europe’s economies rebounded following the end of lockdowns, while shipping and air freight capacity remained tight and costly.
Logistics is particularly snarled in the UK, where a severe shortage of truckers is making it harder for businesses to transport goods and keep shelves stocked.
“We can’t meet 100% of the demand from our customers,” Helena Helmersson, CEO of H&M, said. The disruption will “stay with us for a bit”, she added.
At H&M, sales gained slightly in September, slowing from 14% growth in the third quarter. The Swedish clothing seller sources the bulk of its clothes from Asia, where bottlenecks are delaying shipments.
