Inditex profits have soared by 18% first quarter. Spanish company Inditex owns eight brands, including the Zara, Pull & Bear and Oysho brands. The firm reported a 654 million euro profit for the three months to April 30. Sales rose to 5.5 billion euros in the quarter, an increase of 14%.
Zara is a clothing and accessories retailer and was founded in 1975. Pull & Bear also retails clothing and accessories, changing its name from New Wear S.A. in 1991. Oysho focuses on women’s undergarments and home wear. Inditex is now the world’s largest apparel retailer. It has integrated its supply chain through all its eight different brands and it focuses largely on fast fashion.
‘Fast fashion’ refers to the rapid inexpensive transference of catwalk designs to the store. This enables customers to quickly be able to purchase apparel made to modern fashion designs – often within weeks. Zara is the major Inditex fashion outlet and is growing rapidly. It is currently responsible for around two-thirds of Inditex sales.
The company as a whole has opened 30 stores in this quarter, following 227 new outlets in the first nine months of 2016. Inditex now has outlets in 93 countries. At last count, it had 7,358 outlets worldwide
Online sales are available in a number of Asian countries, including Malaysia, Thailand and Vietnam while India goes online later in the year. Online sales are responsible for a good part of Inditex profits. Because the firm’s fast fashion business model allows Inditex to rapidly replicate fashion runway trends, online sales have increased rapidly. The internet has enabled Inditex to beat all competition including H&M over the past few years.
Inditex is continually expanding, and while there must be an ultimate limit to the number of outlets, it won’t happen anytime soon. Its fashion is available online worldwide, and as stated above, it is steadily making inroads into Asia. This Spanish company spreads its manufacturing worldwide.
It’s complex supply chain is driven by local politics, economics and financial subsidies. It is this business model along with rapids response to new fashions that make Inditex what it is – the world #1 for consumer fashion. Inditex profits look set to increase for a good while yet.
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