An experienced team of executives should facilitate the change in Inditex’s management next year, when the family of billionaire founder Amancio Ortega will strengthen its control over the company, the world’s largest fashion retail group, according to sources and analysts consulted.
Last month the company, owner of the chain Zara, announced that veteran CEO Pablo Isla was leaving office to be replaced by a CEO with no experience in the retail sector and that Ortega’s daughter, Marta, 37, would become president.
The actions of Inditex they fell 6.1% on the day of the announcement, losing some 5.6 billion euros ($ 6.3 billion) from their market value. Investors were concerned about the departure of Isla, which Inditex has led for a decade and has contributed to making it the envy of the sector.
However, the new leaders will be backed by a committee of directors who have been with the company for between 18 and 42 years, which will provide them with continuity and solid support, analysts and sources familiar with the operation of the group said.
Plus, two of the top 10 are family members with decades of branding. Zara Y Massimo Dutti.
“The key to these changes has been, above all, the creation of a steering committee that will allow the family to somehow regain control of Inditex after handing over part of power to Pablo Isla for more than 15 years”Said a person who has worked with Óscar García Maceiras, new CEO.
Marta Ortega She will begin her new role as non-executive president of Inditex in April together with the new CEO.
Isla, who worked alongside Amancio Ortega for six years before the company’s founder retired in 2011, has held executive power at Inditex for the past decade. Isla has not said what he intends to do after his departure.
The non-executive role of Marta Ortega It intrigued some, but it would be a mistake to take the job at face value, said Adam Cochrane, an analyst at Deutsche Bank Research.
“The non-executive president is a common role in the industry, but given her experience in the business and her family connections, her influence on strategic and brand decisions is likely to be greater than other presidents. “, He said.
Marta, who has been working at Inditex for 15 years, had focused on the image and fashion proposal of Zara, the business that contributes 70% of the group’s income.
Team player
People who have worked with García Maceiras and sources familiar with Inditex said their ability to delegate and coordinate will bring out the best in a team that managed to circumvent COVID restrictions and raise sales 7% above pre-pandemic levels in the second quarter , outperforming its closest competitor, H&M.
“(García Maceiras) is a person who works in a team, is discreet and does not have a high profile investment banker. Let no one expect a great revolution at Inditex”Said a person who worked with him and asked not to be identified.
To increase the sense of continuity, his predecessor as CEO, Carlos Crespo, will take over as COO and will be part of the executive committee.
Inditex’s success, according to Jefferies, lies in its supply chain, which allows it to tailor its fashion to customer tastes in a more targeted and timely manner than its rivals.
The company, which also owns Bershka and Pull & Bear, manufactures more than half of its garments in nearby countries such as Morocco, Turkey and Portugal, allowing it to avoid the worst supply chain problems currently plaguing the sector. .
The Spanish firm has also quickly adapted to the pandemic by using its stores as logistics centers to support online demand.
Inditex will present its third quarter results on Wednesday, with sales growth expected to be up to 10% higher than the same period in 2019, according to analysis notes from Credit Suisse, RBC Capital Markets and Jefferies.
.
Kingston is an accomplished author and journalist, known for his in-depth and engaging writing on sports. He currently works as a writer at 247 News Agency, where he has established himself as a respected voice in the sports industry.
