Spanish company Inditex having a globally successful brand like Zara under its portfolio has crossed a valuation mark of over $100 billion last week, with shares witnessing a rise of 36 per cent in the last year. The achievement, only held by select 80 companies worldwide, has now made Inditex the most valuable company in Spain.
Inditex's founder Amancio Ortega is the second richest man in the world. His company's subsidiaries include Zara, Zara Home, Massimo Dutti and Bershka among others. Many studies have been written about how Zara managed to succeed with its fast fashion theory against its rivals like H&M. The company is known for bringing ensembles inspired directly from the runway to its stores within two weeks. Industry experts say that the Zara strategy has been working in favour of the brand for two reasons – one because loyal consumers keep visiting the store to check new collections and then they also feel compelled to buy because the styles can fly off the shelves pretty fast.
According to a Goldman Sachs report which unravels the secret behind Zara’s success, “Unlike fast-fashion retailers, which have buying teams sourcing current trending fashion from third-party vendors, traditional specialty retailers have design teams creating product they believe is going to be trending 12 months out.”
While the apparel retailers are being cautious about their expansion plans, at the beginning of the year Inditex announced its plan to open eight new locations in Manhattan by the end of 2015.
www.inditex.com
