Despite the chilly spring and reluctant consumers, sales at Inditex rose 7.2% in the first half of the year. Growth is slower, however, with flagship Zara dropping prices.
50% more rain, 10% more profit
It has been a tough fashion season for everyone, even for the world’s biggest fashion company. Rival H&M predicted a 6% drop in sales back in June, as the Swedes, like clothing retailers everywhere, saw how bad weather was keeping away already frugal consumers. Fast-fashion specialist Inditex, whose short lead times normally allow it to respond well to unexpected circumstances, is itself feeling the effects: its Spanish home market saw half as much rain as average in June, while accounting for 14.8% of sales.
Still, the fashion giant reported a 7.2% rise in sales to 18.1 billion euros, slower than last year but in line with expectations, according to Reuters. Net profit clocked in at 2.8 billion euros, up by 10%. Zara, Inditex’s biggest brand, responded to the slowdown by raising prices less than its competitors and than last year: women’s clothing prices fell 6% in the second quarter, while they rose 1% on average at H&M, according to analysts.
For autumn, things are looking better already. The first autumn and winter collections are catching on well, the group claims: between 1 August and 8 September, growth picked up again by 11%, which offsets the slowdown in recent months.
