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Who’s the Next Zara?

Madrid — While major industry leaders here say nobody does it better, there are some heirs apparent nipping at Zara’s heels. How close is the competition? <br><br>Mango: Spain’s second-largest apparel exporter (women’s only)...

Madrid — While major industry leaders here say nobody does it better, there are some heirs apparent nipping at Zara’s heels. How close is the competition?

This story first appeared in the July 30, 2002 issue of WWD.  Subscribe Today.

Mango: Spain’s second-largest apparel exporter (women’s only) after Inditex, with 600 stores in 68 countries and forecast retail sales for fiscal 2002 of $1.6 billion. The chain, which manufactures the majority of its merchandise like Inditex, is currently targeting the European market, especially the United Kingdom and France, according to Salvador Vallés, of Mango’s expansion department. “These countries have a potential not yet exploited,” he said. In addition, openings are scheduled this year in Bulgaria and Estonia. Last June, the Barcelona-based company opened its first Australian unit for a retail presence on five continents. As for the United States, “We plan to open stores in major American cities by 2005. But nothing is clear yet,” said Vallés.

Sfera: a new division of El Corte Inglés, Spain’s only department store chain, officially launched earlier this month. Its product mix is similar to Zara’s, with trendy Gen-X women’s, men’s and children’s clothing, innerwear, accessories, cosmetics and a fragrance line at what it claims are “the most competitive prices on the market.” To date, nine Sfera units have opened in Spain including three in outlying Madrid malls. A fourth store is planned for the end of this year on Calle Preciados, a shop-heavy thoroughfare in central Madrid, where retail neighbors include Zara and Bershka. Some of the new stores are previous Marks & Spencer locales. El Corte Inglés took over the M&S Spain locations in December of last year.

Cortefiel: Spain’s giant apparel manufacturer and retail conglomerate with seven divisions including Cortefiel, women’s/men’s; Springfield and Milano, men’s; Pedro del Hierro and Don Algodón, womens; Women’Secret, lingerie, and Douglas, beauty. Cortefiel operates a worldwide distribution network of 726 stores, plus 169 franchises and 24 retail “corners.” There are no U.S. retail outlets, and none are planned — yet. “While we won’t close any doors, our current strategy is to consolidate the European market. So far, nothing is pending in the U.S.,” confirmed a Madrid spokesman. On the other hand, Cortefiel has been struggling of late, with a 72 percent drop in net profits in the first nine months of fiscal 2002.