Zara | Inditex : advertising & marketing assignments

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Zara is the best-known brand in the portfolio of Inditex, now the world's biggest fashion retailer by both revenues and global presence. Despite the recent economic downturn, the group has continued to go from strength to strength, opening several hundred new stores each year. Its key strength has long been the superb efficiency of its manufacturing and distribution system, able to deliver a succession of new designs into stores at a speed which still leaves competitors stumbling. Inditex overtook European rival H&M by revenues at the beginning of 2006, and finally topped Gap in 2009. By late 2018, the group's portfolio housed 7,440 outlets in almost 100 countries. Group revenues reached €25.3bn in fiscal 2017, with net profit of €3.4bn. Retail sales at the main Zara fashion chain were €16.6bn in 2017, with another €830m from its homewares sister Zara Home. The Zara brand alone accounts for more than a third of group outlets. It is accompanied by another six concepts. The next most valuable is Bershka, offering everyday street fashion for a younger market (revenues of €2.2bn). Another brand, Massimo Dutti (€1.8bn), offers more elegant designer clothing. Pull & Bear (€1.7bn) targets a youth market with casual stylish sports wear, while Stradivarius (€1.5bn) offers a more sophisticated range of casual wear for a younger women's market. Although it has a presence in most major global markets, and almost 100 countries overall, Inditex's business is still focused primarily on Europe, where it generates over 60% of revenues. Spain, in particular, still dominates its geographical presence with almost 1,700 stores. The next biggest by store numbers is Greater China with 638 outlets, followed by Russia, Italy, Mexico, Portugal and France. The US has fewer than 100 still, and the UK only 110. The group also has an extensive ecommerce operation. The group is the creation of Amancio Ortega, still the principal shareholder of Inditex, controlling around 59% of the group's equity. He is Spain's richest individual with a fortune worth around $50bn. In 2011 he retired as chairman of the group, passing on that role to Pablo Isla, group CEO & deputy chairman.

Capsule checked 20th February 2019

Who are the competitors of Inditex? The group's principal Spanish competitor in Spain is rival chain Mango, as well as Sfera (owned by El Corte Ingles). International competitors include H&M, The Gap and Arcadia. See Fashion & Accessories Sector index for other companies

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Historical profile information for Inditex

Recent stories from Adbrands Weekly Update:

Adbrands Weekly Update 14th Jun 2018: Zara parent Inditex reported better results for its latest quarter than most rival fashion retailers, but its previously rampant growth has slowed noticeably. Revenues for the quarter were €5.7bn. Same-store sales were up around 5% in the three months to April, down from 6% in the previous quarter and around 10% a year ago. Yet growth is still growth, and Inditex continues to outperform rivals Gap Inc and H&M in that respect. Better still, the company also widened its gross profit margin, a key indicator of performance, to almost 59%.

Adbrands Weekly Update 15th Mar 2018: Fashion giant Inditex - parent of Zara, Massimo Dutti and other brands - reported another year of higher sales for the period to Jan 2018, but growth has slowed significantly, especially in physical retail. Revenues rose 9% to €25.3bn, while profits were up 7% to €3.4bn. However overall like-for-like growth halved from 10% in 2016 to 5%. The star performer, though, was online where sales jumped by more than 40% to €2.5bn. As a result, Inditex said it would accelerate the overhaul of its retail estate, shuttering smaller outlets in favour of big destination stores in city centres. The total number of Inditex outlets decreased for the first time in the final quarter of the latest year, from 7,504 to 7,475 shops, though total selling space continued to rise.

Adbrands Weekly Update 16th Mar 2017: Spanish fashion group Inditex reported another unbeatable set of results for its most recent year. Reported sales jumped by 12% - including a same-store lift of 10% - to €23.3bn. In 4Q alone sales rose by 16% (more than twice the rate achieved by rival H&M in an equivalent period). It said it experienced growth in all geographic regions and across all eight of its brands. Net profit was also up 10% to €3.2bn, and the group is now sitting on net cash reserves of over €6bn. As a result, it plans to raise its dividend to shareholders. Founder Amancio Ortega, who holds 60% of equity, will receive €1.26bn. In the current year, the group said it will accelerate a strategy of closing smaller outlets and replacing them with larger stores nearby.

Adbrands Weekly Update 22nd Sep 2016: No worries of a slowdown at Inditex, owner of Zara and Massimo Dutti. Like-for-like revenues jumped 11% to a little under €10.5bn for the six months to July, while profits were up 8% to almost €1.3bn. The group said performance since July has been even stronger, with sales in local currencies rising 13%.

Adbrands Weekly Update 16th Jun 2016: Zara parent Inditex avoided the headwinds affecting rivals such as Gap, H&M and Marks & Spencer, delivering another quarter of strong growth in both revenues and profits. In its 1Q to April, profits rose 6% on sales up 12% to €4.9bn. Both figures were above expectations, prompting a string of analysts to reiterate their admiration for the group's lean business model, even compared with closest rival H&M. "There are some deep structural differences separating the product, business model and likely future fortunes of these two fashion retailers," Societe Generale's Anne Critchlow told trade bible WWD. "We must prefer Inditex, today, tomorrow and well into the future."

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