Mall.cz will close its brick-and-mortar stores at the end of January

Amid a decline in retail sales and a merger with Polish e-commerce firm Allegro, retailer Mall Group – owner of the Mall.cz shop – has announced that it will close all of its brick-and-mortar stores by late January 2023.

“The decision to close our brick-and-mortar branches was not easy, but the last months associated with our integration with the Allegro Group have confirmed to us that we need to speed up and deepen our transformation,” said Mall Group spokesperson Pavla Hobíková in Seznam Zprávy.

Orders for in-store collection can be placed until Jan. 22. The company has been in operation since 2000 and is one of the most recognizable names in the Czech retail market.

The company is among the most popular general retailers in Czechia, selling items such as electronics, furniture, gardening tools, and pet supplies. There are six physical stores across Czechia, four of which are in Prague. Consumers are able to order online and collect goods at these stores, as well as purchase products.

Mall.cz presently has about 15,000 such delivery points around Czechia. Shoppers in Czechia also frequently use Alza pick-up boxes, which form part of a large network around Prague and other cities. 

Less than 15 percent of all Mall.cz customers use the company’s brick-and-mortar stores to collect items, the company revealed in mediaguru.cz.

With consumer confidence in Czechia nearing record lows due to elevated inflation and lower disposable income, retail sales have taken a hit in the country. November registered the seventh consecutive month of year-on-year declines in retail trade, falling by 8.7 percent, according to data from the Czech Statistical Office.

This may be reflected in the financial performance of Mall Group: in the third quarter of 2022, the firm registered a CZK 260 million loss. In the 2021-2022 financial year, it posted a CZK 11 billion loss.

E-commerce has been growing strongly in popularity in the last decade, with turnover of internet stores rising from about CZK 52 billion in 2013 to CZK 190 billion in 2020, according to fintree.cz. Although e-commerce sales declined by 12 percent year on year after an inflationary 2022, total turnover in 2022 surpassed that of 2020 by CZK 1 billion. 

Despite a bump in 2022, the rise of e-commerce and pick-up boxes may cause the closure of more brick-and-mortar stores in the months and years ahead.