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 any style or color failed to sell, production was halted immediately. If a style or color was selling well, new colors or patterns were added to existing designs.
New fashions are then produced in relatively small batches, so flops can be disregarded after their first appearance and hits can be followed quickly by similar incarnations. Pioneering the fast fashion movement in the mid-70s with the launch of Zara, Ortega’s innovative retail strategy — rapid response to trends and consumer demand — has turned Zara into a global retailer boasting over 1,700 individual storefronts in 86 countries. Through Inditex Group, Ortega Gaona oversees over 6,000 stores around the world. According to Forbes, Ortega Gaona is the wealthiest retailer in the world and worth $69.1 billion as of 2019.
The 88-year-old Ortega was born in northwestern Spain in 1936, the son of a railroad worker and a stay-at-home mother.
“But in 10 to 15 years’ time there are likely to be more competitors operating a similar business model.” But if other High Street brands aren’t taking it on, online brands might – companies like Boohoo and Asos are only a fraction of the size of Inditex, but are focusing on shortening the time it takes to react to trends on the High Street and Instagram. Shops were taking too long to bring people the fashions they craved. By the time a product arrived, fashion-conscious shoppers wanted something different. Even this week, when the company’s rising share price made him the richest man in the world for two days, he wasn’t ready to retire.
- 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.
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- Today, his retail company Inditex SA — which owns Zara, as well as Massimo Dutti and Pull&Bear — has over 6,600 outposts around the world.
- And it’s not a model that can be easily copied by other brands, which don’t have an established local supply chain, says Simon Bowler, from equity research company, Exane.
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In 1963, Ortega launched his own manufacturing company Confecciones Goa S.A., forming sewing cooperatives with local women and offering fast production turnaround. In 1975, with the business growing steadily and having acquired several factories in Spain, Ortega opened his first store in A Coruña, just a few blocks from where he worked as a teenager. The index places Ortega as the 14th richest person in the world in 2023. Despite running major fashion retailer Inditex for four decades, he’s intensely private – there were no public photographs of him until 1999, and in 2012, Bloomberg noted that he had only ever granted interviews to three journalists.
One evening, as he was owner of zara brand walking home with his mother, he witnessed her pleading for credit to buy groceries and coming out of the store empty-handed because the store owner refused. At that moment, Ortega was so humiliated that he decided he would drop out of school and start working—a decision that turned out to be the first step in one of the greatest retail careers in history. The group also announced the appointment of new chief executive Óscar García Maceiras on Tuesday. When he resigned as chairman in 2011, he didn’t put his feet up. Instead the man known as “The Boss” has remained very much involved in the company.
Every day he still makes the 10km journey from his town centre house to the Inditex headquarters, based just outside the coastal town of A Coruna where he first launched the Zara brand. He started making clothes with his siblings and future wife, Rosalia Mera, in their home in the early 1960s. In 1975, Ortega and Mera opened the first Zara store in downtown La Coruna, Spain, according to Bloomberg. Ortega is very private about his personal life, and as of 2012 he has only given three interviews to journalists.
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“The current chief executive Carlos Crespo has moved over to become chief operating officer, so it’s not like he’s leaving the company. And they say Oscar Maceiras is good at team building.” Most of its clothing is made close to its Spanish headquarters or in nearby countries such as Portugal, Morocco and Turkey, helping the firm to achieve its famously fast reaction times to new fashion trends. Ortega owns about 59 percent of the company, which has a $103 billion market cap. Today, the company includes brands like Bershka, Massimo Dutti, Pull&Bear and Stradivarius.
Bershka was its second-biggest brand by revenue in fiscal 2023. In addition to industry-leading design-to-store turnaround speed, another strategy of Ortega’s that sets Inditex apart from competitors is its minuscule advertising spending. In 1949, at the age of 13, Ortega went to work as an assistant to a luxury shirtmaker in his hometown of La Coruña, where he learned to make clothes by hand. Over the next 14 years, he was promoted to assistant manager and shop manager, gaining direct experience not only in dealing with customers but also in purchasing fabrics and other supplies to manufacture apparel.
