Bankruptcy race among clothing stores in Norway

The clothing industry in Norway has been severely affected by the Coronavirus crisis. Since March, 34 companies have gone bankrupt.

In April last year, clothing stores accounted for only 1 percent of bankruptcies in Norway, in April this year the proportion was 7 percent, writes Dagens Næringsliv.

According to the employer organization Virke, turnover in the clothing industry in Norway fell by 55 percent in March compared to the same month last year. The accumulated turnover loss in April is close to 25 percent.

– “Businesses that sell clothes, shoes, and bags are those that have suffered the most in the trade as a result of the Coronavirus measures,” says industry director Bror Stende in Virke trade union to DN.

He says the big chains often have control over the entire value chain because they both produce and sell their own goods, but that it can be difficult for the small ones who only resell other company brands.

– When one may have been living on weak equity in recent years, and almost driven on the credit of their creditor, the Coronavirus crisis takes the weakest of the load right away. When shutting down completely, these businesses have no chance, simply, he tells the newspaper.

© NTB Scanpix / #Norway Today