Zara Owner Built a Post-Covid Retailer Before Coronavirus

A few weeks after Spain declared a nationwide lockdown in mid-March to fight the growing coronavirus outbreak, clothing retailer Inditex SA began running low on goods.

The world’s largest fashion retailer typically operates a lean warehouse operation, preferring instead to hold the majority of its stock in stores that double as e-commerce fulfilment centres. That way, turnaround is faster, shelves are replenished more regularly and inventory is kept to a minimum.

But with about 3,500 stores worldwide closed, this carefully balanced just-in-time cycle of goods was reaching breaking point. By April, Inditex sent out an unusual request to employees, seeking volunteers to retrieve clothes and accessories left in stock rooms and on shelves in the hundreds of Zara, Massimo Dutti and other brand stores to fulfil e-commerce orders.

The unorthodox blend of local manufacturing, nimble logistics and aggressive embrace of e-commerce has helped Inditex weather the fallout from the global lockdown better than many other retailers. It’s also helped recalibrate operations for a future of shopping where face masks, limited store access and distancing stand to push consumers online in ever greater numbers.