- Jun 17, 2015
- Reaction score
1000 stores is nothing for Zara. if you go to spain, every decent sized small town has a Zara. Frankly I do think they are overexposed in Europe, Easily 400-500 stores will disappear in Europe alone. Too many stores to serve too little people. Some of these stores actually depend on the tourist crowd than the locals.I increasingly think that fast fashion won't survive this. A week or two ago, Zara announced that they will be closing 1,000 to 1,200 of their stores worldwide. Their online sales currently make up 14% of their profits. They hope to make up for the shortfall in brick-and-mortar sales by boosting online sales to 25%.
The Spanish clothing retailer is shifting its focus to online shopping amid the coronavirus crisis.www.today.com
But with such low margins and a high return rate, it's hard to see how they can switch to being an online retailer. Also, fast fashion depends on impulse purchases. You try something on in the store and think you look good in the store's environment. The item isn't too expensive, so you walk out with it.
At home, you get to mull over your purchase for thirty days. You may have a clearer sense of whether you like the item in the very non-glamorous environment that is your home. You also may be more likely to try and return something. With a high-end item, I assume the purchase is more considered. But with cheaper items, you'll probably add a bunch of stuff to your cart "just to try out."
I think in the beginning, people assumed that fast fashion would be one of the "winners" in this (or, at least, in one of the best positions relative to the rest of the fashion market). Logic is that as people earn less money, they'll be more frugal about price. But I'm starting to think they're in the worst position because of the reliance on brick-and-mortar.
(Although, I suppose there's ASOS, which is online. So maybe this is just the vulnerability of H&M and Zara)
Uniqlo will start to hit saturation soon. There is only so much basics that one can buy and wear ad infinitum. And like you said, their clothes don't fall apart as easily. but that means less volume of purchases that they can keep pushing out. Everybody considers Uniqlo fast fashion. U don't get to change the definition because of your own whims and bias.