Less than a week before the publication of Inditex’s financial figures for the third quarter of the current 2024 financial year, store closures led to speculation about a possible withdrawal of the Spanish group from Algeria. However, Inditex denied these rumors to FashionUnited.
“Some Inditex stores in Algeria have been temporarily closed as operational issues have prevented stock replenishment,” Inditex told FashionUnited. Despite these specific problems affecting operations in part of its Algerian network, the group “is not considering exiting the Algerian market”. It is therefore expected that the affected branches will resume normal operations once these issues are resolved.
Closed branches cause confusion
The reason for the temporary closures is, in particular, difficulties with the franchise partners in Algeria as well as in other important and potential markets in North Africa and the Middle East. Azadea Group is reportedly struggling to maintain normal operations of the multinational’s fashion chains in Algeria. These difficulties, which do not affect the Spanish company, appear to be linked to the complex administrative nature of the Algerian market. Meanwhile, confusion is spreading locally among the growing customer base of the Spanish multinational’s brands, as when they visited various outlets operated by Azadea, they found not only locked doors, but also empty interiors.
The Algerian news agency Maghreb Emergent, known for its critical stance towards the country’s political elite, added to the uncertainty by echoing the bewilderment of those who encountered closed Inditex stores earlier this week – a situation already reverberating in the social was discussed in the media – and reported that Zara would cease its activities in Algeria. The closures, according to the report, affect not only Zara, but all Inditex brands present in Algeria. Additionally, the news outlet downplayed the “temporary” nature of the closures, portraying them as part of a purported wave of closures by Inditex to close 1,200 stores worldwide. This information was subsequently refuted by the same news agency, arguing that the closures could not be justified given the positive economic performance of the Spanish company.
However, the circumstances in Algeria led many Inditex customers to believe that the company was preparing to withdraw from the country. Inditex reiterated its commitment to Algeria and assured FashionUnited that there are no plans to withdraw from the country.
The company did not provide details on the reasons for the temporary closures, but also emphasized that only “some” and not all of the 20 Zara stores in the country are affected.
This edited article previously appeared on Fashionunited.es and was created using digital tools translated.
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