Inditex Reorganises its Logistics & Unifies its Warehouses for Online & Physical Stores

28 February 2018 – El Economista

In recent years, one of Inditex’s big secrets has been its logistical efficiency and its capacity to move any garment anywhere in the world in record time. Nevertheless, the development of its online business has now forced the Galician fashion giant to go a step further.

With the aim of reducing costs and increasing its profit margins, which have been decreasing systematically since 2012, Inditex has launched a project to unify the management of stock for its physical and online stores. The idea is that the same warehouse should be able to supply stores on the high street and in shopping centres, as well as customers who buy garments through the website.

The project forms part of the company’s digital integration policy. In fact, data collected by Inditex shows that a significant proportion of customers make their purchases online in the same physical store and that around 60% of the returns and exchanges for products purchased through the online channel are managed in a physical store.

Omnichannel strategy

In this vein, in recent months, Inditex has been strengthening its omnichannel strategy. In this way, at its store in Marineda, in La Coruña, it has opened an automated delivery point, with capacity for up to 700 packages, where users may pick up orders they have placed online without having to wait.

After launching that project last September, under the development of its equipment at the Technological Centre in Arteixo (La Coruña), the company explained that its aim is to take a step further towards the integration of its physical and online stores.

Improved deliveries

In December, the President of Inditex, Pablo Isla, announced that the group had started to offer same-day delivery in six cities – Madrid, London, Paris, Istanbul, Taipei and Shanghai – and next-day delivery in Spain, France, the United Kingdom, Poland, China and South Korea.

According to Isla, it is about looking for an “increasingly comprehensive management of the online business”, whereby allowing improvements in delivery times. Just a few weeks ago, at the end of January, Zara, the flagship brand of the Galician group, unveiled the first store in the world that specialises in making and collecting online orders, as well as processing any returns or exchanges, at a new store in the Westfield shopping centre in Stratford (London).

That is a pop-up or temporary store, which will remain open until the flagship store in the same shopping centre is reopened in May, which is going to see its surface area double to 4,500 m2 with a completely new concept.

“The staff in that store use tablets and mobile devices to help customers, who have the option of receiving their orders just a few hours later – if the order is placed before 14:00 – or the next day – if it is placed after that time. It also facilitates the payment system thanks to an innovative system of bluetooth card payment terminals”, explain sources at Inditex. The company, which has 7,504 stores in 94 markets around the world, has an online presence in 45 countries and is continuing to make progress against the large online platforms, such as Amazon and Alibaba. Meanwhile, the stock market is still punshing the group for its falling margins; on Tuesday, its share price fell again, by 0.86% to €25.25.

Original story: El Economista (by Javier Romera)

Translation: Carmel Drake

Inditex Puts 16 Stores in Spain & Portugal up for Sale for €400M

12 December 2017 – Eje Prime

Inditex is getting rid of some of its property portfolio. The Galician giant has put 16 retail premises up for sale, of which fourteen are located in Spain and the other two in Portugal. The buyer will have to commit to leasing the stores to the retail group for twenty years.

The retail group is looking to raise USD 472 million (€400.5 million) from this operation, through which it is seeking to harmonise its leasing strategy, according to Bloomberg. Inditex has only confirmed the sale of the premises.

The Spanish company ended the first half of this year with an 11.5% increase in sales and a 9% rise in its net result, percentages that were similar to those recorded during the first six months of 2016. The company chaired by Pablo Isla recorded turnover of €11.671 billion, whereby exceeding the €11 billion threshold for the first time during the first six months of the year.

The net result of the company that owns Zara amounted to €1.366 billion during H1 2017, compared to €1.256 billion during the first half of last year. Its EBITDA also grew at a rate of 9%, from €2.112 billion to €2.292 billion.

Original story: Eje Prime

Translation: Carmel Drake