Although the cases of the omicron variant increase in the world and several countries have returned to restrictions, the most representative brands of fast fashion do not suffer, for now, the consequences.
This is reflected in the sales of Inditex, the Spanish company that owns Zara, and of its Swedish rival, H&M. Both brands say they have exceeded or at least equaled the level of income they had before the arrival of the virus.
Both companies believe that their marketing strategies have been successful and that people returned to physical stores. In addition, online channels grew notably.
For Inditex, the world’s largest fast fashion retailer, sales in the third fiscal quarter (until October 31) in constant currency increased 10 percent compared to the same period in 2019.
In addition, in the report published this Wednesday, December 15, it says that sales continued at the same rate until last December 10.
The second player of fast fashion, Hennes and Mauritz (H&M), declared sales at pre-pandemic levels between the months of September and November.
According to Marcos López, top manager of Zara’s Capital Markets department, “the recovery has gained momentum.”
An important fact is that the rebirth of sales occurred even with the problems that exist throughout the world to obtain raw materials and some other inputs due to the crisis of the containers.
Inditex says it was able to overcome this crisis because its brands (among which in addition to Zara are Massimo Dutti, Bershka and Pull & Bear) produce more than 50 percent of the garments near Spain.
Specifically, Inditex recorded sales of 7,310 million euros and a net profit of 1,210 million euros between August and October, values that correspond to the previous expectations of analysts.
Zara, H&M and online sales
Online sales, meanwhile, rose 125 percent between January and September compared to the same period in 2019. The expectation is that in 2021, the digital channel will represent 25 percent of total sales for the year.
Despite the good results, Inditex and H&M shares fell almost 2 percent in the first trades in Europe.
It should be remembered that Inditex is involved in its first major change in senior management: Marta Ortega, daughter of the founder and billionaire Amancio Ortega, will assume the presidency in April 2022. This may be generating some interference among investors.
H&M, for its part, reported net sales of SEK 56.9 billion (about $ 6.2 billion) between September and November.
In the case of the Swedish group, it is not yet working 100 percent in its physical stores, since just over 110 H&M points of sale are still closed in some European countries due to covid cases, especially in Austria and Slovakia. .
Some stores in Southeast Asia were also closed.
On the contrary, Zara and the other Inditex brands have all their stores open (about 1,970).