Inditex: 2018

In 2018, Inditex, based in Spain, was the largest specialist fashion retailer in the world, generating sales of $31.5 billion in 2017 from a portfolio of eight retail brands selling through a total of 7,475 stores located in 96 countries and from websites in 49 countries. Its largest brand, Zara, generated sales of $20.8 billion and operated 2,118 stores. Since its IPO in 2001, Inditex had grown sales an average of 14.3% per year and net profits by 16.3% per year, adding over 6,000 stores in the process, and its stock had significantly outpaced the FTSE 100. While many fashion retailers were retreating in the face of weak demand and competition from online retailers, Inditex grew like-for-like sales for the year in all concepts and geographies. Online sales were up 41% year-on-year, reaching 10% of total sales. For several years, the company had been slowing the growth in retail space and investing in large flagship stores to support its online business. Significantly, in late 2016 Inditex closed four small Zara shops in the company's hometown of La Coruña and opened a 54,000-square-foot store in its place. Indeed, in the last quarter of 2017, the net number of store additions turned negative for the first time. Meanwhile, online fashion specialists such as U.K.-based ASOS were growing rapidly, adding thousands of styles a week to their websites and providing thousands of pick-up and drop-off points (PUDOs) at local retail locations around the world to support their online sales. And then there was the threat of Amazon, which had been pushing into online fashion for over a decade. Was Inditex chairman and CEO Pablo Isla doing enough to turn the online threat into an opportunity?

• Growth strategy
• Competitive strategy
• Succession planning
• Multinational corporations
• IPOs