Inditex reigns unopposed in fashion

Inditex reigns unopposed in fashion

Neither the eternal rival, H & M, nor the aspiring one, Fast Retailing (Uniqlo), seem one more year in a position to threaten the hegemony of the world leader in textile distribution, Inditex. The group founded by Amancio Ortega closed 2017 with a profit of 3,368 million euros, 7% higher than the previous year, and sales of 25,336 million, 9% higher than in 2016. In addition, he managed the highest net margin among the main players in the sector, 13%.

In the same period, its main competitor, H & M, reduced its profit by 13%, to 1,655 million euros, despite increasing its turnover by 4%, up to 20,449 million. Its net margin was 8%. The Swedish chain is having problems adapting to the transformation that is undergoing a sector in which physical stores are no longer everything. Although it ensures that its online channel is "good", it is not going so strong as to compensate for the problems of its establishments, which had a weak performance during the year.

Fast Retailing, whose fiscal year ended on August 31, has been self-proclaimed as aspiring to the world throne of fashion retail. But the Japanese company remains far from its goal despite closing a great exercise. Its profit increased by 29.8% to 1,191 million of euros after its sales made it 14.4%, to 16,391 million euros. Both parameters show a net margin of 7.2%, very far from what was achieved Inditex, which implies that The Spanish company manages its expenses more efficiently and is able to transform a greater percentage of its turnover into profits. A Fast Retailing has a potential margin for significant external improvement. Only 4.2% of its sales were made outside of Japan.

Primark accounted at the end of its fiscal year -including between October 2017 and September 2018- a profit of 8,560 million euros, 6% higher than the previous year. Its profit stood at 965 million, 14.7% higher than the previous year. The Irish chain, which has 45 stores in Spain and has become the main competitor of the Galician group in its country of origin, is also the one that comes closest to it in terms of efficiency, with a net margin of 11 ,two%. However, the group did not close a good year because, if it were not for the increase of its stores in fifteen, its profit, in terms of comparable area, would have fallen by 2.1%.

Although it is far from optimizing its sales, The US GAP has managed in its last fiscal year to reverse the inertia of recent years and increase its profit for the first time since 2014. The group achieved earnings of 694 million euros, 25% higher than the 554 million of the previous year, after several years of a profound restructuring after the failure of its international expansion. He did it by optimizing his sales, which barely grew by 2.2%, to 12,990 million euros. 80% of its turnover came from its country of origin, the United States, while its sales in Asia and Europe worsened.


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