Despite a major international expansion for the Spanish retail giant in recent years, the company’s domestic market is still its strongest area
Despite major international expansion for Spanish retail giant Inditex in recent years, with the USA at the centre of this growth, the company’s domestic market is still its strongest area. «It is the market where we were born and where we are going to continue,» said CEO Óscar García Maceiras, during a presentation of the company’s latest results this week.
With a record profit of 5.381 billion euros on a global scale, one of the figures that most surprised the market was the boost in sales, which reached 35.947 billion euros, up 10.4%. Of this total figure, Zara, Pull & Bear, Massimo Dutti, Oysho and the rest of the group’s brands sold 5.666 billion euros of goods in Spain, 12.85% more. It is the first time (in the years analysed) that turnover in the country has grown at a faster rate than the global average.
In 2022 year-on-year revenue growth in Spain matched the pace of global sales. However, it has been in the last year that the gap has been more evident. All this has been achieved despite a difficult environment due to inflationary pressure which has seen consumers focussing on food shopping rather than spending on clothing and other consumer goods.
The decline in the purchasing power of Spanish households and the impact of geopolitical tensions have led to a slowdown compared to last year’s growth, when turnover in Spain rose by 17%. But the numbers still add up.
Added to this is a number of store closures bringing the number of shops in the country to 1,157; some 68 fewer than in 2022 and 423 fewer than in 2019, the year before the pandemic, when the figure was around 1,535.
Logic would suggest that fewer shops mean lower sales, but Inditex looks at optimisation and the concept of ‘fewer shops, but bigger’. The objective? To gain square metres in key locations to make room for different spaces with special collections, collaborations with well-known celebrities, footwear, accessories, sportswear, cosmetics, etc.
This lower number of shops has not had an impact on the workforce in Spain either. In fact the number of Inditex employees currently stands at 47,761, which is 1,607 more than 46,154 last year.
