Inditex is the Spanish fast-fashion empire which owns different brands that span from Zara to Oysho, and it generated almost €28 billion in 2021 by following a company-operated strategy, where its flagship stores drive high traffic toward its central locations across the world. In addition, post-pandemic, Inditex has been ramping up its e-commerce strategy. Indeed, by 2021, over 25% of the sales were generated online.
Understanding how Inditex works and makes money
Indeed, Inditex generated most of its sales from company-operated stores in 2021 in the following order:
- Zara: 88% of sales from company-managed vs. 12% from franchised.
- Pull&Bear: 82% of sales from company-managed vs. 18% from franchised.
- Massimo Dutti: 84% of sales from company-managed vs. 16% from franchised.
- Bershka: 82% of sales from company-managed vs. 18% from franchised.
- Stradivarius: 77% of sales from company-managed vs. 23% from franchised.
- Oysho: 84% from company-managed vs. 16% from franchised.
- Inditex Overview:
- Store Strategy:
- Inditex’s flagship stores play a crucial role in attracting high traffic to its central locations globally.
- The majority of the sales come from company-operated stores rather than franchised stores.
- Online Sales Growth:
- Post-pandemic, Inditex has been focusing on its e-commerce strategy.
- Over 25% of the total sales were generated online in 2021.
- In 2022, online sales represented 25.5% of total sales.
- Brand Breakdown:
- Zara: Generated €19.58 billion in revenue in 2021, witnessing consistent growth from previous years.
- Pull&Bear: Revenue increased to €1.87 billion in 2021 from €1.42 billion in 2020.
- Massimo Dutti: Revenue grew to €1.65 billion in 2021 from €1.27 billion in 2020.
- Bershka: Revenue reached €2.18 billion in 2021, up from €1.77 billion in 2020.
- Stradivarius: Revenue surged to €1.82 billion in 2021, compared to €1 billion in 2020.
- Oysho: Revenue increased to €600 million in 2021 from €522 million in 2020.
- Online Sales Breakdown:
- Inditex’s online global sales increased to €7.5 billion in 2021 from €6.6 billion in 2020.
- Online sales contributed to 25.5% of total sales in 2022, a decrease from 32% in 2020.
- Continued Growth:
- Year-on-Year Comparisons:
- Most of the brands within Inditex experienced revenue fluctuations from year to year, influenced by various factors including market trends, consumer preferences, and external events like the pandemic.
- Adaptation to E-commerce:
- The company’s increased focus on e-commerce demonstrates its adaptability to changing consumer behaviors and preferences.