The owner of clothing companies Zara and Massimo Dutti, Inditex recently said that it would be closing about 1,200 retail stores worldwide within the next two years. The recent decision by the company comes after it posted its first ever loss due to the coronavirus pandemic.
Meanwhile the company also unveiled a $3.1bn plan to accelerate its focus on large stores and online shopping. The new plan by the cash-rich Inditex is because of the massive increase in popularity during the ongoing coronavirus pandemic and subsequent lockdowns.
The announcement comes after Inditex saw an incredible 95 percent surge in online sales for the month of April alone.
The move to shift to an online shopping model marks a break in its pattern of rapid expansion over the last 15 years. The company now has almost 7,500 stores around the globe spanning 96 different countries.
In addition to developing its online sales platforms, the conglomerate also hopes to implement new technologies in its remaining physical locations in order to streamline consumers’ shopping experiences.
“The overriding goal between now and 2022 is to speed up full implementation of our integrated store concept, driven by the notion of being able to offer our customers uninterrupted service no matter where they find themselves, on any device and at any time of the day,” said CEO Pablo Isla.
The novel coronavirus pandemic has forced several businesses to reassess their business models. Several organizations who thought of remote working as a burdening task have now committed themselves fully to implement it forever.
Similarly, traditional retail stores too have now realised the importance of e-commerce. However, such a quick change in business models can lead to several layoffs and huge training cost for the existing staff.
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