Inditex Group

Topics: Inditex, Zara, Massimo Dutti Pages: 11 (3428 words) Published: February 5, 2012
David Llacuna Ferrer (2011950089)

1. Inditex Group
1.1 Inditex
1.2 Share information and ownership
1.3 Inditex portfolio

2. Competitors
2.1 H&M
2.2 Uniqlo
2.3 GAP
2.4 Benetton

3. Inditex in South Korea
3.1 Entry strategies
3.2 Entry strategy in South Korea
3.3 Lotte
3.4 SWOT analysis
3.5 Inditex in Asia

4. Bibliography

1. Inditex Group
2.1 Inditex
Inditex is a large Spanish multinational and nowadays is the largest fashion group, above of GAP. It is made up of almost a hundred companies dealing with activities related to textile design, production and distribution. Inditex was founded by Amancio Ortega, who is the richest man in Spain, and the 7th World's richest man Inditex has more than 5,000 stores all over the world and owns many brands that I will define in the following points. The majority of Inditex stores are corporate-owned, but as we will see, Inditex uses other strategies to open new stores. Nowadays Inditex employs more than 100.000 workers all over the world. | 2010| 2009| 09/10|

Income| 12.527 M€| 11.084 M€| 13%|
Net income| 1.732 M€| 1.314 M€| 32%|
Stores| 5.044| 4.607| 437|
Coutries| 77| 74| 3|
Workers| 100.138| 92.301| 7.837|

The characteristic that make Inditex different from its competitors is that Inditex almost designs and manufactures everything by itself, and thanks to that, new designs can be dispatched twice a week to its stores. The headquarters of Inditex are in Arteixo, a town in northwestern Spain, and it is there where almost all its merchandises are manufactured; about 50% of the production is made near Arteixo, about 30% is made in China, and the rest of the production is made in Europe. Moreover, Inditex has another big plant mainly responsible for shoes' design, production and distribution in Elche, in the Spanish Mediterranean coast. Between years 1996 and 2001, the group tripled its size, and after 2001 it rocketed its revenues from $2.43 billion in 2001 to $13.6 billion in 2007. As a result, and in August 2008, Inditex overcome Gap, making Inditex the world’s largest fashion retailer. Actually, Inditex is doing one of the fastes global expansions the fashion world has ever seen, opening an average of one store per day and entering into new markets. Inditex is doing all of this in one of most difficult industries to operate in, due to short product circles, volatile demand, and competition. As a result, if Inditex failed in the prediction of future fashion trends, it should have really bad consequences for the company. So, in a market where a company’s performance is dependent on the success of the seasonal collections, Inditex is a really good example of a company that is capable of generating growth and continuously expanding its operations. Inditex has changed the whole perception of business processing in the clothing industry with its alternative in-house fast-fashion model.

2.2 Share information and ownership
Share information
In 2001, Inditex was listed on the Madrid stock exchange market, and institutional and private shareholders bought 26% of the shares. Today it is listed at all four stock markets in Spain: Madrid, Valencia, Barcelona, and Bilbao.

If we looked at the graphic below, we realized that Amancio Ortega holds the majority of the shares and he has the controlling voting rights of the company, because he is the owner of Gartler S.L. and Partler S.L., which have the 50,01% and 9,28% respectively. It means that, Amancio Ortega, the founder of Inditex, still has the majority control of the company, although the company was listed many years ago (2001).

2.3 Inditex portfolio
As we have said before, Inditex is a well diversified group of brand concept stores, engaged in textile designing, production and distribution. Through its different stores, Inditex is capable to cover all the main segments in the fashion group, and each store is...
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