Inditex, the parent company of globally recognized brands such as Zara, has recently announced that it achieved record-breaking quarterly profit and is now focusing on further developing its business model. In a statement, CEO Óscar García Maceiras emphasized the company’s commitment to an integrated, digital, and sustainable business approach, highlighting the growth potential it holds.

During the first quarter, Inditex’s turnover experienced a significant growth of 36% to reach 6.74 billion euros. This growth was largely driven by strong sales performance in popular brands like Stradivarius, Pull&Bear, Bershka, and Zara. The desire of customers to regain a sense of normalcy post-pandemic has played a major role in this positive trajectory. Currently, 90% of Inditex’s store network is operational, indicating a strong recovery for the retail industry.

However, Inditex did face challenges in the first quarter due to store closures in China, Russia, and Ukraine. These closures, resulting from the impact of Covid-19 and other war-related issues, led to an extraordinary charge of 216 million euros in the company’s accounts. Despite these setbacks, Inditex showcased a remarkable performance across all regions, with the United States showing particularly strong progression.

To enhance its differentiation, digitalization, and sustainability efforts, Inditex plans to invest 1.1 billion euros during this fiscal year. Additionally, the company expanded its presence by opening stores in 16 international markets within the first three months of the year, bringing the total number of operating stores to 6,423 by the end of the period.

While online sales experienced a slight decrease compared to the previous year due to a strong comparable base, Inditex aims to surpass 30% of total turnover through e-commerce by 2024. The company plans to maintain stable pricing overall but selectively increase prices in the most affected markets to protect margins.

In an effort to make the industry more efficient and sustainable, Inditex implemented an initiative to charge for online returns at home or at a designated collection point. Surprisingly, this move has not affected sales or customer satisfaction, indicating its success.

Overall, Inditex’s record-breaking profit and ongoing business development efforts demonstrate its resilience and commitment to growth in the retail industry. With a focus on digitalization and sustainability, the company is determined to stay ahead in an ever-evolving market.

Useful links:
1) Inditex Official Website
2) The New York Times: Zara’s Parent Company Reports Record Profits