You Know Zara but do you know the man who built it? – The story of a true gentleman – Amancio Ortega
For people who love fast-fashion, Zara is the place to go. Zara is one of the largest international fashion companies. It has 2259 stores spread over 96 countries. From prominent celebrities to royalty everyone loves to flaunt their Zara clothes. What is interesting is the now $9.4 billion company had very humble beginnings.
Amancio Ortega, the owner and founder of Zara, who has always maintained a low media profile is among the top 5 richest people on earth. Amancio Ortega was born on 28th March 1936 in a small Spanish locality. The youngest among four siblings Amancio had spent his life living hand to mouth. Due to financial issues his mother had to often borrow from the local shopkeepers in order to feed her children.
One day Amancio came to know that a local shopkeeper had not only refused to help his mother but had also insulted her. This deeply affected him and Amancio left school at the age of 14 and found a job as a shop hand for a local shirtmaker called Gala. In the beginning, he used to deliver clothes to other sellers and learned to make clothes by hand. Later he became the senior manager in that store. In his free time, he used to go to his sister’s house and make modifications to the popular dresses left over from the shops to make new and cheaper clothes and sell them to the retail shops.
Once his products got a steady demand from the market Ortega gathered the local women into a thousand different cooperatives in 1972 and formed a company called Confecciones Goa that sold dressing gowns, babywear, housecoats and lingerie that they produced.
The initial investment for this company was about 25 dollars in 1963. Ortega’s siblings and wife Rosalia Mera became partners in this venture. Confecciones Goa created products for retailers, they didn’t yet have their own brand. After gaining substantial experience in the field, he and Rosalia later opened a retail store they called Zorba. The name of the store was based on the couple’s favourite movie. However, when they found out that a local liquor store was also operating under the same name they changed the name to Zara that quickly expanded into multiple stores across Spain.
Zara attracted sales because it sold the latest fashionable clothes at reasonable prices. In time, he incorporated the brand into a holding company named the Inditex Group and bought 59.29% of the group’s shares, thereby becoming its largest shareholder. Ortega expanded his wealth by acquiring the Massimo Dutti, Uterque and Stradivarius fashion designs, as well as the Pull&Bear and Bershka brands. Ortega differentiated himself from competitors by limiting advertising, controlling most of his supply chain and expanding as wildly as he could.
The company spread to the United States of America, Europe and other nations. The Spain-based company employs more than 92,000 employees, operates more than 7,000 stores and reported earnings of 20.9 billion euros, or $22.7 billion, in January 2016. The company’s success is attributed to the business model in which the customer is at the heart when considering aspects like design, production, distribution and sales through its extensive retail network.
By the end of 2000, Ortega owned premium office and retail properties in major cities in Spain, parts of Europe and the United States. Frugality, focus and hard work are three of the reasons for Amancio Ortega’s success. Over the years, Zara has remained faithful to its core values, expressed simply in the same four keywords that define all the stores: Beauty, Clarity, Functionality and Sustainability.
Amancio Ortega who showed the world how to succeed in style.