Spain, China and Poland lead Inditex store closures in first quarter
The Spanish group, owner of Zara, continued to reduce its number of stores in its domestic market, in line with what happened in previous quarters. However, the company also diminished its store count in several emerging markets.
Spain and China lead Inditex store closures at the start of the year. These two countries have been, together with Poland, the ones where the Spanish group has shut down the highest number of stores in the first quarter of fiscal 2018 (ended on April 30). In addition to its country of origin, the group also lowered its store count in markets such as Italy, Portugal and Japan.
Inditex has been adjusting its vast network of brick-and-mortar stores in the world for five years, in line with the gradual growth of ecommerce sales. The transformation of its distribution model, based so far on capillarity in many city districts, now searches for prominent and large retail locations, which has resulted in store closures in non-strategic secondary places.
In fact, during the analysts’ conference for the financial results presentation, Inditex’s chairman, Pablo Isla, pointed out that the group’s total selling space continued to grow despite adding fewer stores.
Inditex has been transforming its distribution network for several years, betting on larger stores in high streets
Spain once again became the country in which Inditex shut down more stores worldwide. The company ended the first quarter with 25 net closings, until operating with 1,663 points of sale. The group has gradually reduced its presence in the Spanish physical channel in recent years, after shutting down 99 shops in the year 2017.
China took the silver medal in the closures ranking of Inditex between February and April. Specifically, the company ended the period with 576 stores in the Asian country, seventeen less than at the end of fiscal 2017. Last year, the group stopped including the points of sale of Hong Kong and Macao within China’s store count.
Poland took the third place by number of closures. Inditex operated with 246 stores in the European country at the end of the first quarter, ten less than the ones it had last January. The Spanish fashion giant has been shrinking its presence with stores in the Polish market, where it operated with 272 points of sale at the end of 2015.
The group closed four stores in Italy and another four in Portugal between February and April 2018
Inditex’s expansion in Saudi Arabia also slowed down at the beginning of the year. The company ended the first quarter with 177 stores in this market, six less than at the end of fiscal 2017. Spain was not the only mature market where Inditex reduced its brick-and-mortar footprint. In Italy and Portugal, the company shut down four stores in each country, until operating with 392 and 338 retail units, respectively. On the other hand, the company ended the quarter with 148 points of sale in Japan, two less than at the end of 2017.
Turkey and Belarus lead the openings
Despite the closures carried out in many countries around the world, the Spanish juggernaut maintained an expansive policy through the brick-and-mortar channel in several markets, all of them emerging ones. In Turkey and Belarus, where the group started operations in 2017, Inditex increased by four its number of points of sale in the first quarter, until reaching 228 and 11 stores, respectively.
On the other hand, Inditex kept up the opening pace Israel and Russia. In the later, the company added three points of sale, reaching 552 stores. In the Israeli market, the company ended the quarter with 79 stores, three more as of January 31.
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