French luxury giants LVMH Moët Hennessy Louis Vuitton and Hermès said on Friday they would temporarily close their stores in Russia as the crisis in Ukraine continues to escalate.
LVMH, which is estimated to have more than 120 stores in Russia, said it would close them on Sunday “given the current circumstances in the region”, according to a spokesman. The spokesman added that the company will continue to pay salaries and benefits to its 3,500 employees in the country. Hermès said in a link to LinkedIn that it would temporarily close its stores and suspend trade in Russia from Friday night.
“Deeply concerned about the current situation in Europe, we have unfortunately decided to temporarily close our stores in Russia and pause all our business activities,” Hermès said in a statement.
Western retailers such as Ikea, H&M Group and Nike have announced calls to halt sales and temporarily close stores in Russia in recent days and have expressed support for the people of Ukraine. Most said they would continue to pay their Russian employees. In addition to escalating violence in Ukraine, retailers are responding to wider trade disruptions in Russia and sanctions targeting financial transactions in the country.
Stockholm-based Ikea said this week it would suspend exports and imports to and from Russia and Belarus, suspend retail operations and pause operations on its wooden furniture unit. The company told The New York Times in an email on Friday: “Due to current international sanctions and their intentions, we do not make transactions, including payments inside and outside Russia or Belarus.”
“The sanctions regime affecting Russia is evolving rapidly as countries coordinate and implement a number of targeted financial and trade sanctions,” said Steve Lamar, president and CEO of the American Clothing and Footwear Association. “Among those affecting retailers and their workers are restrictions on financial institutions and financial flows, such as wage payments.