Ortega’s wealth is soaring even as his country battles an economic meltdown. Spain’s unemployment is hovering around 25 percent as the country suffers its second recession since 2009 and a debt crisis roils Europe. Standard & Poor’s cut Spain’s debt rating to one level above junk on Oct. 10. With the global economy growing at its slowest pace in three years, Ortega’s cost-conscious lines are ringing up sales.
“That turbulence strangely favors a retailer like Zara,” said Nancy Koehn, a retail historian at Harvard Business School. “Among fashionistas, there’s a new badge of status in finding the cool at a lower price.” Kate Middleton, the duchess of Cambridge, is sometimes photographed wearing Zara.
Inditex, short for Textile Design Industries in Spanish, boosted revenue to 7.2 billion euros ($9.3 billion) during the first half of 2012, 17 percent more than a year earlier. Revenue in Spain remained stable at about 1.6 billion euros during that time.
“They are fast reacting to fashion, they are very flexible with their product and they are growing nicely,” said Peter Braendle, who helps oversee $55 billion, including Inditex shares, at Swisscanto Asset Management in Zurich.
After stepping down as Inditex chairman last year, Ortega still travels a half-hour to headquarters most days from La Coruna, where residents speak the local Galician language. He usually settles at a table amid the designers, fabric experts and buyers for the Zara Woman line.
Wearing a simple shirt and slacks rarely of his own brands, which are cut for slimmer men, he confers on everything from placement of a zipper to the September debut of Zara’s Chinese Web site.
“He’s extremely close to the business operation, where he meets and sees and talks to everyone,” said Antonio Camuñas, a former president of the Spain-U.S. Chamber of Commerce who connects clients with politicians, bankers and the media and has advised Ortega for almost two decades. Ortega declined to grant an interview for this story.
When Camuñas, now 53, started working for Ortega in the early 1990s, the retail magnate had never been interviewed or photographed for publication. At the time, so much mystery surrounded the man behind the sleek Zara stores sprouting up across Spain that people speculated that Ortega must be a frontman for a Galician drug-smuggling ring, Camuñas says, calling the idea nonsense.