Inditex’s adaptability is key to its success
Inditex, the Spanish company that operates Zara stores, has become the world's biggest clothes retailer by sales because of its "ability to respond quickly to changing trends," the Financial Times reported.
Founder Amancio Ortega, 75, who is Spain's richest man, stepped down from the chairman's post this year. His successor is Pablo Isla, who had been the company's CEO for the past six years, the article said.
The company still produces 49% of its clothes in Spain, Portugal and Morocco, according to the report.
[W]hen Inditex floated in 2001, with Mr. Ortega retaining 59 per cent of its shares, financial analysts initially doubted the sense of manufacturing at home when rivals were rushing to take advantage of cheaper costs in Asia. Mr. Isla argues that Inditex's business model is proving itself as retailers grapple with weak consumer confidence against the backdrop of their own costs rising.
The company was founded in 1975 as a bathrobe factory in A Coruña, Spain, the article said.
Inditex employees, too, say the company's key strength is its roots as a manufacturer, meaning a cultural emphasis on logistical efficiency epitomized by its base on an industrial estate outside of A Coruña....
(Source: Financial Times, May 23, 2011.)