These are not good times for the textile sector. The Coronavirus crisis has led to the closure of its stores in almost all its markets for long weeks and, despite the fact that online commerce has exploded and the blinds have been lifted in many of its establishments, the light and brightness of the past are still far away.
An example of how difficult it is to fly back is Fast Retailing, the matrix of Uniqlo and the second largest textile group in the world only behind Inditex. The Japanese giant has just presented its results for the last nine months, which span from September to May. In other words, with a certain recovery in terms of the number of stores open in the de-escalation process.
In those first nine months of its fiscal year, the Japanese group cut their income by 15.2%, up to the equivalent of 12,800 million euros. Worse was his profitability, given that his net profit sank more than 47%, up to 91,475 million yen, the equivalent of 758 million euros.
CHANGES OF PLANS
Beyond the figures themselves, despite reflecting the Covid-19 coup for the sector, the underlying problem is the change in strategy that it can entail and growth in the medium and long term. In this sense, the parent company of Uniqlo talks about growing, especially in Asia, which may entail stepping on the brakes in terms of landing in Europe after opening, in recent years, its first establishments in Spain, in Madrid and Barcelona.
The slowdown in Uniqlo is not the only bad news for the sector in the last week. In the domestic market, sales do not pull. At least, they don't at the moment. Keep in mind that discounts have been accelerated and advanced this year. Inditex anticipated the sales of its main brands, including Zara. And the Corte Inglés has made a similar movement in recent hours, increasing discounts to relaunch consumption.
However, for now, bellows are missing. The bosses of the small shops, the Spanish Confederation of Commerce (CEC), has already announced that sales this season of discounts are between 20% and 30% lower than last year. This employer assumes that, if things continue like this, two out of ten stores may close when autumn arrives. There are months ahead, until the end of August, to conclude the sales season, but to this day, the data does not invite optimism.
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