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Inditex ramps up production over supply chain concerns

Inditex, the global fashion group, has accelerated its clothes manufacturing in order to stockpile inventory ahead of potential supply chain difficulties in the next six months.

The owner of Zara said on Wednesday that “in the face of possible supply chain tensions”, it had temporarily increased production “in order to increase product availability without any change to commitment levels”.

It did not elaborate on the nature of the supply chain issues it foresaw, but the move comes after coronavirus pandemic disruption hit retailers and as the sector grapples with rapidly rising raw material and energy costs.

The Spanish company said the value of its inventory at the end of July was €3.67bn, about 43 per cent higher than at the same time last year.

Inditex announced a 24.5 per cent rise in sales to €14.8bn in the six months to the end of July and a 41 per cent increase in net income to €1.8bn.

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