Zara owner Inditex admits further price increases are on the way
Zara owner Inditex has admitted it plans to increase prices again this autumn, as it battles elevated headwinds.
It comes as clothes shoppers are facing their own constraints on discretionary spending as household bills rocket.
Europe’s largest fashion retailer will boost prices in the second half of the year, its chief financial officer Ignacio Fernandez told Reuters.
“The level of newness, quality and design of our collections is driving our sales, but obviously we are always thinking about a stable pricing policy,” Fernandez said.
A further mid-single digit average price hike will come after previous increases in the spring and summer.
The apparel retailer posted a 41 per cent jump in profit for the six months to July, in the first batch of financial results since Inditex founder Amancio Ortega Gaona ‘s daughter, Marta Ortega, stepped into the role of chair.
Inditex posted revenue of €14.84 bn, an increase from €11.9bn a year earlier.
The company said its autumn/winter collections had been “very well received by our customers.”
Store and online sales between 1 August and 11 September had risen 11 per cent versus the record period in 2021.
However, this was down from a 15.9 per cent increase posted in the second quarter.
Shares in the Spanish retailer were up three per cent on Wednesday afternoon.
The fast fashion powerhouse had “come out of the pandemic with all cylinders firing,” Charlie Williams, equity research assistant at Hargreaves Lansdown had said ahead of the results.
“Strong performance in the early part of this year’s been helped by increased traffic to stores and continued digital sales,” they said.