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Zalando remains bullish on growth plans

Zalando is accelerating investments in its technology and fulfilment capabilities this year, after 2015 sales came in at the upper end of its growth forecasts.

Zalando

Zalando

Zalando

The etailer has earmarked €200m (£155m) to invest mainly in its distribution, including the development of a third large fulfilment centre in its home market of Germany, in Lahr near the French border, and its first satellite warehouse in Stradella, Italy. It has also fast-tracked plans for a new large fulfilment hub, although said it was too early to confirm locations.

Management board member Rubin Ritter said the company is piloting ways to speed up delivery to customers including the use of Uber-style networks, same-day delivery from its warehouses and dispatch from its brand partners’ stores, but has no plans to invest in its own fleet.

It comes as Zalando announced turnover grew 33.6% to €2.95m (£2.29m) in 2015, compared with the previous year. Adjusted EBIT was €107.5m (£83.4m) at 3.6% margin for the firm, which stocks more than 1,500 brands including Topshop, Ted Baker and River Island.

Ritter brushed off concerns around Amazon’s push into the fashion market with the launch of its own label, as Zalando has “plenty of opportunities for growth”.

“Although we have grown rapidly over the last eight years, we now have approximately 1% market share in of the total fashion market in Europe. You can compare that to 5% in our most mature market and most mature category, which is footwear in Germany, so there is lots of scope for further growth,” he said.

“We know how the fashion industry works for our fashion brands and we have our own labels. Our position is very strong, so we don’t have to be overly concerned about what the competition is doing.”

He told Drapers plans are on track to relaunch Berlin trade show Bread & Butter as a consumer event in the third quarter of this year.

“It will be the start of the new season and we will bring brands and consumers together, with a mix of entertainment, fashion shows and it will be shoppable,” he said. “It will be a very interesting first stab at the new concept.”

Zalando also acquired online advertising solutions firms Metrigo and Nugg.Ad in the last year to help its brand partners “build up their advertising capabilities as they budgets from offline to online”.

 

Readers' comments (1)

  • Zalando, along with Yoox and Zara and H&M are doing very well. What does this say about British based fashion retailers? Could do better?

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