With Fewer Stores but More Volume, Zara Parent Company Inditex H1 Sales Gain 10.2 Percent
In This Article:
PARIS — With fewer stores but bigger sales, Zara parent company Inditex continued to show strength as first-half sales rose 10.2 percent at constant currency, or 7.2 percent on a reported basis, maintaining the momentum from the first quarter of the year.
The increase in sales was not due to price hikes, Inditex chief executive officer óscar García Maceiras emphasized, but upping the number of items the Spanish retailer moved through its sales channels in the period.
More from WWD
-
EXCLUSIVE: Stefano Pilati Is Rebooting, Powered by Mario Grauso
-
Egyptian Jeweler Azza Fahmy Makes Retail Debut in Saudi Arabia With Arty Store
-
Why Investing in Generative AI, Other Tech Improves the Customer Experience
“It’s all volume driven, and then the combination of very strong store and online platform [performance] and some space growth,” he said in a call with analysts following the release of the results.
The fast-fashion behemoth operates Bershka, Oysho, Pull&Bear, Stradivarius, Massimo Dutti and Zara Home in addition to its flagship Zara brand.
Without breaking down brick-and-mortar versus online sales, Maceiras did credit its newer, more selective physical retail model for a chunk of that growth.
The sales increase came even as the retailer continued with some targeted shutterings, bumping its number of stores down slightly, about 1.5 percent. It closed 47 Zara stores, 33 Oysho stores and 16 Zara Home stores, while opening 18 Pull&Bear locations.
However, it added sales channels in 34 markets, such as launching Zara sales online in Turkey as it continues to strengthen its omnichannel positioning, and opening physical stores in India, Peru and the U.S.
With targeted closures, the company is focused on expanding floor space and upscaling the interior design of its physical locations, and adding specialized departments like accessories, lingerie and including Zara Home inside some of its shops.
To that end, it opened its new 53,820-square-foot flagship in Lisbon on Sept. 5. Taking over an entire city block, the new four-floor outpost is now the second-largest Zara store it the world and includes a Zara Home department. The brand closed three stores in the city to condense its presence into the expansive space, in line with the brand’s overall retail strategy of absorbing smaller stores in major cities into flagship destinations.
Other stores with its cleaner design concept opened in Riyadh, Saudi Arabia; Liverpool, U.K.; Thessaloniki, Greece, and Bangalore, India, among other locations. The strategy will add a 5 percent bump in gross floor space by the end of 2026, even while store count continues to fall.