Zara’s India arm reports profits in two out of three years

While a slow economy and an unemployment rate

of 26 percent may have tainted Spain’s brand image worldwide, Zara, the iconic fashion label from the country is creating waves in India. The world’s most popular ‘fast fashion’ brand, Zara’s Indian unit Inditex Trent -- a joint venture between Inditex and Tata Group’s retail arm Trent -- has registered profits in two out of the three years it has been in the country.

Zara continues to replicate the same model that has worked for it globally -- creating affordable, copied versions of the latest in trend or designer-wear and making them available to shoppers at a fast pace. Inditex not only owns Zara, but it also takes care of every bit of operations -- from design to distribution and a large chunk of manufacturing. And any new style that does not attract shoppers within a week, goes off the shelves instantly.

In the first half of 2012, Inditex clocked revenues worth 9.3 billion dollars (about Rs 49,000 crores). The Indian unit made profits of Rs 38.3 crores and Rs 22.5 crores in the previous two financial years, as per documents filed with the registrar of companies.

Amancio Ortega Gaona, who was last year named the third-richest man in the world, founded Zara as a maker of lingerie in the northern Spanish town of La Coruna in 1963. Today, there are 1,600 Zara stores in 85 countries. In India, Inditex Trent plans to open over 18 stores in the next three years in Tier II cities.