Family business giants eye new markets
Family-controlled clothing empire Inditex and America’s largest retailer Walmart are eyeing new markets in a quest to further expand their operations.
Inditex, founded by Spanish billionaire Amancio Ortega, announced on 19 May that it has opened its flagship Zara store in Sydney, Australia as part of its strategy to expand in Latin America, Australia and Africa.
A spokeswoman for Inditex told CampdenFB that the group also plans to open a store in Melbourne in the next few weeks. The company, whose core market is in Europe, will adopt its range for the new stores so they are suitable for the Australian climate.
The expansion in Australia puts Inditex one step ahead of fellow family-controlled rivals H&M and Gap, as neither have fully integrated operations on the continent.
Ortega stepped down as chairman of the €12 billion company in January this year and was replaced by non-family Pablo Isla. Speculation is rife that Ortega’s daughter Marta will eventually take control of Inditex but a spokeswoman refused to comment on this. Marta is currently working as an employee within the business not in a management position.
While the clothing chain expands down under, America’s retail giant Walmart looks to enter Europe. According to reports, Walmart has set up a team in London to look for opportunities for mergers and acquisitions on the European continent.
The announcement of plans to expand into Europe comes days after the group reported its first quarter earnings, which saw slow growth in its US home market and in the UK.
Walmart, 40% controlled by the Walton family, first entered Germany in 1997 but pulled out in 2006 following poor sales in the country. According to reports it is now looking to re-enter Europe to counter slower growth in its other markets.
The Arkansas-based company had 2010 fiscal revenues of $419 billion, up from $405 billion the year before. Second-generation Rob Walton is the current chairman and is worth an estimated $19.8 billion according to Forbes.
