At the ultramodern headquarters of Inditex, in the small Galician town of Arteixo, near La Coruña where the famous clothing brand Zara was born, the euphoria is palpable. Despite the crisis the market is going through, nothing seems capable of slowing down the insolent growth of the Spanish textile giant. Despite “a complicated environment, inflationary pressures, very weak growth and an unstable geopolitical context which affects our main markets”, as listed this Wednesday, March 13 by the general director, Oscar Garcia Maceiras, the parent company of Zara announced a net profit, up 30%, of 5.4 billion euros. A record.
With nearly 36 billion euros in turnover, Inditex increased its sales by 10.4% compared to 2022, and the start of 2024 is encouraging (+11% between 1er February and March 11). Revenues from online sales jumped 16%. With 9 billion euros in sales, or nearly 25% of the total, it confirms the good functioning of a strategic channel for resist new players in the “ultra fast fashion” online market, such as the Chinese Shein.
The assurance of “great flexibility”
For the year 2024, the group plans to invest 1.8 billion euros in order to“improve the customer experience” and 900 million euros for the development and construction of new logistics centers, mainly in Spain. And faced with the consequences of tensions in the Red Sea on goods traffic, Mr. Garcia Maceiras was calm, recalling that “more than 50% of Inditex’s production comes from local markets: Spain, Portugal, Morocco and Turkey”, and that it has long-term agreements with transport companies which guarantee it “great flexibility”.
Another major Spanish group in the textile sector, Mango also announced record sales in 2023, exceeding 3 billion euros in turnover for the first time (+15%). The company doubled its profits, to 172 million euros, and opened 130 stores. Optimistic, it unveiled on Monday March 11 a development plan aimed at opening 500 new stores and reaching 4 billion euros in sales by 2026.
However, in Spain, these two companies are not representative of the state of the market. Far from their double-digit growth, total sales in the fashion sector increased by just 2.8% in 2023 in the country, according to the Textile Trade Association (Acotex). A number “disappointing as they plunged by 40% in 2020, and by 13% more in 2021, before rebounding by 13% in 2022estimates its president, Eduardo Zamacola. The general trend is not the results of Inditex but the difficulties of many brands which are simply trying to survive. he said. Former director of the family children’s fashion brand Neck & Neck, created in 1993, he knows something about it: his company was placed in liquidation in 2023.
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