With his wealth, he has also built one of the world’s most valuable real estate portfolios. By the early 1960s, Ortega had already developed the core operating principles for the business model that would later be called fast fashion. The secret to Zara’s success largely was because of the way it kept up with street fashion with the changing times. Most other fashion brands would take owner of zara brand a whole six months to get their new designs into the market. In the fast-fashion model that Ortega built, Inditex spends more initially to keep production close to home, but its short supply chain means that the entire design-production-delivery team can keep their fingers on the pulse of emerging trends and produce only what will sell.
- Today, Zara has close to 6500 stores across 88 countries around the world.
- In 1991, in addition to geographic expansion, Ortega began to expand Inditex’s retail portfolio beyond the flagship Zara format, with the launch of Pull&Bear, an urban fashion chain, and the acquisition of 65% of Massimo Dutti, then a men’s fashion brand.
- She married top Spanish equestrian Sergio Álvarez Moya in February 2012, but the couple separated in 2015.
- After all, he has 60 years’ experience in fashion retail, built up from humble beginnings.
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Their daughter has an estimated $9.7 billion net worth and controls 4.5% of Inditex, though she’s not involved in the company. She’s the second-richest person in Spain behind her father, according to Forbes. Other Inditex brands include Bershka, Massimo Dutti, Oysho, and Zara Home.
… he reportedly bought an office block in London’s affluent Mayfair neighborhood that borders Hyde Park …
After launching their first company, Confecciones GOA (his initials reversed), in 1963, Ortega and Rosalia Mera spent the next decade expanding their client base and building their production capacity. Within 10 years, their business had grown so rapidly that GOA had 500 employees. A key driver of GOA’s growth throughout these early years was that Ortega eliminated middlemen and controlled manufacturing and the supply chain by organizing thousands of women into sewing cooperatives and trucking in textiles from Barcelona. After getting permission from his employer to produce his own designs, Ortega, his future wife (Rosalia Mera), and his three siblings set up a workshop in their home to sew quilted bathrobes and lingerie based on designer brands and then sell them at budget prices to retailers. After that first brainstorm, Ortega never veered from the two core principles—customer preference and speed—that enabled him to build Inditex.
By the 1990’s the store had expanded into the United States, France and most of the Europe. Today, Zara has close to 6500 stores across 88 countries around the world. With around 90 stores globally, Uterqüe is Inditex’s smallest and most exclusive brand, selling women’s clothing and accessories for the more mature shopper. Since Inditex’s initial public offering in 2001, Ortega has received more than 12 billion euros, or about $13 billion, in dividends. Most of that cash has been reinvested in real estate through his company’s investment arm, Pontegadea, per Bloomberg. Ortega and Perez share two children, including a daughter, Marta, who began in the family business nearly 16 years ago, according to the Financial Times.
In 2001, Ortega founded the Amancio Ortega Foundation, a charitable organization focused on education and social welfare. Ortega protects his privacy so fiercely that, when he made his first public appearance in 2000, in advance of the Inditex IPO, the fact made headlines in the Spanish financial press. Until 1999, no photograph of Ortega had ever been published—and he has granted very few interviews to journalists over his entire career. In the street, I only want to be recognized by my family, my friends and people I work with.
He gradually gathered further experience with other retailers and by the early 1960s was ready to set up in business with members of his family and his future wife, Rosalia Mera. They launched first a textile manufacturing company, then later, the Zara brand. Sometimes he sits down with the Zara Woman design team and they kick around ideas for the coming weeks and months – the new layout for a store, a new design for the upcoming winter collection. After all, he has 60 years’ experience in fashion retail, built up from humble beginnings. In 1991, in addition to geographic expansion, Ortega began to expand Inditex’s retail portfolio beyond the flagship Zara format, with the launch of Pull&Bear, an urban fashion chain, and the acquisition of 65% of Massimo Dutti, then a men’s fashion brand. (It acquired the remaining 35% in 1994 and soon added a women’s line.) In 1998, Ortega introduced Bershka, another entirely new retail format targeting the young female market.
He is the wealthiest person in Spain and among the wealthiest people in the world. Ortega built his retail empire as a pioneer of fast fashion—a retail concept based on the rapid production and distribution of inexpensive versions of designs copied from fashion runways or pop culture icons. Amancio Ortega developed the business model that would later be called fast fashion, revolutionizing the retail fashion industry and becoming one of the world’s richest men in the process.
Ten years later, in 1985, Ortega incorporated Zara into a holding company called Inditex.
While it made a brief foray into men’s wear in 2017, this trial was axed in 2018. The retailer has over 970 stores in 76 markets around Europe, the Middle East, Africa, Asia, and South America, some of which are franchised locations. Bershka is the second-largest chain by store count in Inditex’s entire operation. It has over 1,000 stores in 70 markets, and its sales represent 9% of the total revenue for the whole group.
Ortega is very reclusive and keeps a very low profile.[28] Until 1999, no photograph of Ortega had ever been published. You can buy anything from bed linens to home furnishings and kitchen wares. While it is certainly not a budget brand, it’s considered to be a stylish alternative to more expensive brands such as Pottery Barn. This teen-focused brand has a very similar price point to Bershka, and there’s a lot of overlap in the core customer and the style.
Rather than cutting costs by outsourcing to China and waiting months for delivery like their competitors, Inditex drives profit by selling at full price and rarely getting stuck with unwanted stock. Ortega’s business model for Inditex has been so successful for so long that fashion insiders, from competitors to industry analysts, study his strategies carefully. In addition to state-of-the-art design and production, the computerized inventory systems that linked stores to factories prevented unnecessary capital expenditure by removing the need for large warehouse inventories. For example, once each Zara store was linked to the factory system, not only was all sales information automatically sent back to headquarters in Spain, but the on-site staff also constantly monitored the stock. If a style or color was selling well, new colors or patterns were added to existing designs.
He also built an equestrian center near La Coruna, as his daughter Marta competes in show jumping, according to Bloomberg. Reuters reported that Ortega held around $6.6 billion in real estate assets by the end of 2015. Ortega picked up another New York property in 2016, this time a hotel at 70 Park Avenue in Murray Hill for $67.6 million, according to The Real Deal.
That’s where Zara beat the rest of them and became the favourite brand among people who liked to keep up with the fashion. Ortega was famous for his view on clothes as a perishable commodity; that people would love to use them and throw them away, just like yogurt or bread. It is often cited that he produces ‘fresh baked clothes’ that survive the changing street fashion trends for not more than a month or two. It all began when Ortega established a dress-making factory, Inditex, in the year 1963.Ten years later, he started off a small store that was named as Zorba in La Coruna, Spain with a budget of a meagre 30 Euros. Zara slowly expanded its empire from the town in Spain to the rest of the country and then later to Portugal.
