Is Inditex planning to capture a lower price point?
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Is Inditex planning to capture a lower price point?

Inditex has a big group of recognizable brands under its company umbrella, including names like Zara, Pull & Bear, and Massimo Dutti. But one brand you may not have heard of is Lefties. Originally started as an outlet for Zara leftovers in 1993, the brand now has 130 stores worldwide – that’s nothing compared to Zara, but it’s bigger than some of Inditex’s smaller brands. The questions are: why aren’t the company making it more visible? And do they plan to?

Inditex shares surged at the end of last week

inditex gph

SOURCE: Yahoo Finance

Lefties is basically a womenswear outlet with a price point between Forever 21 and Primark. It’s less responsive to customer tastes than Inditex’s big fast fashion brands, and has a product offering more in with New Look. Currently, that means festival fashion and summer dresses. It’s a more affordable brand than many of Inditex’s others, and is clearly aimed at Millennials.

The thing that has some analysts looking at Lefties is its recent expansion. For the first 20 years of its life, it was confined to Spain. But now, it has branches in Portugal, Mexico and Russia. Its most recent move was into the Middle East last December, with a store in Qatar. According to Retail Week “Rumour has it that further international stores are on the cards.” They think the UK could be Lefties’ next port of call. But are they right?

Retail analyst Richard Hyman spoke to the publication, saying:

“Consumers are a bit constrained and pressured economically. I think the opportunity to buy Inditex product at lower prices would be a great attraction. It’s not like Inditex to miss an opportunity. Are they going to put some oomph behind it and start growing it more quickly? I would be surprised if they didn’t.”

Disclosure

Dominion holds Inditex in its Global Trends Luxury Fund. 


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