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The global fashion business journal

Oct 19, 20196:12am

Inditex, H&M, Gap and Fast Retailing’s stock rise to 12 billion euros in 2018

The inventory of the four giants has risen by 66% since 2014. H&M and Fast Retailing hold the largest stock, at around 20% of their annual revenue.

Jul 15, 2019 — 10:00am
Iria P. Gestal
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Inditex, H&M, Gap and Fast Retailing’s stock rise to 12 billion euros in 2018

 

 

Almost 12 billion euros. That is how much stock the four largest fashion retailers hold last 2018, according to their annual reports. Inditex, H&M, Fast Retailing and Gap’s inventory has risen 66.4% since 2014, although most of them have increased its stocks in line with the increase in sales. Inditex has the less stock, related to its revenue, with just 10.4%, compared with 17.9% of H&M.

 

The fourth largest fashion retailers added up 11.9 billion euros in stock last year, taking last Friday’s exchange rates. That’s 19.6% up versus 2017, mainly because of the rise registered by Uniqlo’s owner, which changed its timings of inventory recording in 2018.

H&M closed 2018 with an inventory of 37.7 billion kroner (3.6 billion euros), up 11.9% from 2017 and almost double than in 2014. The group’s stock has increased far more than its sales, reaching 17.9% of its revenue last year. Four years ago, its stock was about 12.8% of sales.

 

“While inventory levels were up year-on-year, the inventory situation improved in the fourth quarter compared with the third quarter – in terms of both level and composition”, said H&M CEO Karl-Johan Persson in the company’s annual report. “This sequential development is a result both of stronger collections and of the improvements of our buying and logistics processes”, continued.

 

 

 

 

In the case of Fast Retailing, the rise in inventories consisted of a 92.3 billion yens impact resulting from changes in the timing, reaching 464.8 billion yens (3.8 billion euros) as the company details in its report.

 

Increase in real inventory was 82.8 billion yens (679 billion euros), of which about 44.6 billion yens were from Uniqlo International, other 32.9 billion euros yens were from Uniqlo Japan, 3.300 billion from the Gu brand and 2 billion from Global Brands (J Brands and Comptoir des Cotonniers).

 

 

 

 

 

“Uniqlo International inventory increased in line with an expansion of the segment network by 152 stores and an early launch of winter ranges -says the company in its report -; Uniqlo Japan inventory increased due to larger orders of year-round core ranges and early orders of fall and winter stock”. The stock of Fast Retailing hit 21.8% of its sales, although in real terms it was about 17.5%, up from 15.6% registered in 2017. In 2014, Fast Retailing stocks were about 15.6% of its revenue.

 

Gap has lower stock levels, at about 12.9% of its sales, with 2.1 billion dollars (1.9 billion euros) last year. Four years ago, its inventory was just 11.5% of its revenue.

 

Inditex, who perfectionated the just in time system to reduce stocks and adjust the production to the demand, has more reduced stock, with 2.7 billion euros last year, just 1.2% up from 2017 and about 10.4% of its revenue. Since 2014, the group’s stock has risen in line with the increase in sales: while inventory rose 46.1%, revenue increased 44.3%.

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