The Key To The Future Development Of Zara Parent Company: Environment Friendly Growth Strategy

According to the world clothing shoes and hats net, recently,

The largest parent company in the world

Inditex SA, the retailer's Pablo Isla president, delivered a speech at the company's shareholders' meeting.

Pablo Isla analyzed the data of Inditex 2016 years, and stressed that environmental friendly growth strategy is the key to the future development of the group. At the same time, the group will attach importance to the circular economy centered on human, social, environmental and product quality.

Isla also mentioned that "stability" and "integration" are the key to Inditex's future growth. He believes that Inditex in the future should be a "people-oriented, innovative talent based, entity oriented store and online store" company.

The board passed the dividend scheme for shareholders in 2016: the dividend of 0.68 euros per share, an increase of 13.3% over the same period last year, and the dividend of Inditex increased by 89% over the past 5 years, which is an attractive compensation policy for shareholders.

In 2016, Inditex had more than 7200 sales outlets in 93 global markets, and 41 online sales platforms with sales of over 23 billion 300 million euros and a profit of 31.75 billion euros.

(see the report for details:

Momentum slowed down, Zara parent company Inditex2016 fiscal year gross margin fell to the lowest in the past 8 years, but overall still better than H&M.

Isla also added that the tax paid by Inditex accounted for 2% of the total tax revenue of Spanish Company, and the total tax revenue of the company was about 5 billion 600 million euros.

At present, Inditex has 162 thousand and 450 employees from 99 different countries, using 45 different languages to highlight the company's concept of respect for differentiation.

Isla hopes Inditex can go farther and farther on the road of people-oriented.

In 2016, Inditex raised 1 billion 400 million euros of funds, and the total amount of financing in the next 5 years will reach 7 billion euros. Most of the funds will be spent on technology development, including the RFID system that has been used in Zara and will soon visit Massimo Dutti and Uterq e stores. It is estimated that by 2018, all Inditex brands will start using RFID system.

(see the report: Zara completes the installation of RFID system in 2200 retail stores and logistics centers around the world, which will significantly enhance the logistics and shopping experience).

Isla emphasized the stable growth mode of the group: in the past 5 years, although the comparable growth rate dropped from 69% to 37%, all markets achieved positive results.

He said the group's goal is to implement its short-term and long-term strategy globally.

"The UK referendum will not affect Inditex's stock and investment plans in the UK, but will continue to develop our plans in other markets."

For the environment-friendly growth strategy based on circular economy, Isla has quoted a series of important principles of the company, including pparency of supply chain management, suitable working environment, employee safety and health, high wages, collective bargaining, women's rights and protection of immigrants.

The strategy also includes the Closing the Loop (closed loop) project that has been implemented for a year.

"Staff as the focus of economic policy, product quality optimization, coupled with a complete production cycle and environment-friendly program, constitutes a closed loop project of the company."

Closing the Loop, in collaboration with C Ritas, the Red Cross, Oxam and China Environmental Protection Foundation, has recovered over a hundred tons of discarded clothing, shoes and accessories over the past year.

The company's environmental friendly commitment also includes the Wear the Change products launched by Zara Join Life and Oysho. The company has recovered over 10000 pieces of discarded products, and manufactured them with the most advanced technology to implement the concept of environmental friendliness.

Isla also mentioned investment in eco efficiency. At present, the company has 4519 ecological stores, which conform to the standards of sustainable development, accounting for more than 71% of the total number of stores. It is estimated that this proportion will reach 100% by 2020.

Compared with traditional stores, such eco stores can reduce water consumption by 40% and 20% of energy consumption on average.

Inditex has 85 million fans in its social media network, and launched mobile payment in 15 countries in 2016. The ultimate goal of the group is to provide consumers with high standard services.

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