Written by: Katie Scott, Business Reporter
Soaring costs are being blamed for upcoming price hikes by fashion label, Zara.
The brand had already raised prices in the spring and summer; but has made the call again. This is, however, despite “a 41 percent jump in profit for the six months to July and sales which rose by around a quarter,” says Reuters.
CFO Ignacio Fernandez of Inditex, the parent company of fashion brand Zara said: “The level of newness, quality and design of our collections is driving our sales, but obviously we are always thinking about a stable pricing policy.”
The increases earlier in the year came amidst rising inflation but also at a time when shoppers were buying more for their holidays and were emerging post-Covid. Shoppers appear to have been undeterred by the price increases. The company reported revenue of 14.84 billion euros up from 11.9 billion euros a year earlier.
The news from Zara follows an announcement from rival Primark that it would not increase its prices. At the end of June, Swedish brand H&M announced it may also raise its prices. It said: "Although most of the restrictions associated with the Covid-19 pandemic essentially seem to be over, many challenges remain. Disruption and delays still exist in the supply chain, but are gradually being eased. At the same time, there is substantial inflation."
