Zara-owner Inditex starts online sales at budget brand Lefties

MADRID, Sept 3- Zara-owner Inditex’s little-known budget brand Lefties started online sales in Spain and Portugal on Thursday, giving the label a digital advantage over discount fashion chain Primark in its second-biggest market. Lefties sells low-priced clothing for women, men and children and is present in six countries- Spain, Portugal, Russia, Mexico,…

By Sonya Dowsett

MADRID, Sept 3 (Reuters) – Zara-owner Inditex’slittle-known budget brand Lefties started online sales in Spainand Portugal on Thursday, giving the label a digital advantageover discount fashion chain Primark in its second-biggestmarket.

Lefties sells low-priced clothing for women, men andchildren and is present in six countries – Spain, Portugal,Russia, Mexico, Qatar, and Saudi Arabia – with over 100 stores.

First set up in 1999 as a way to clear Zara clothing fromprevious seasons, Lefties now has its own designers and ranges.However, it has little visibility compared to Inditex’s mainbrands like Zara, Massimo Dutti and Bershka and it does notappear on the list of brands on the Spanish company’s website.

A Lefties store on Madrid’s central shopping drag Gran Víasells short printed dresses for 12.99 euros ($15.33) and cottoncandy-striped shirts for 8.99 euros – a similar price point toclothing on sale at the flagship Primark store next door.

Primark, owned by Associated British Foods, isactive on social media but has no online offer. AssociatedBritish Foods finance chief John Bason said in June Primarkwould not rethink its lack of online offer.

Online sales have soared during the COVID-19 pandemic due toshuttered stores and shopper reluctance to return to busystreets and malls.

But the cost of servicing those orders eats into marginseven before factoring in returns, especially on low-cost items.

Societe Generale calculates that online would not beprofitable for Primark if it were to offer free online deliveryand returns and estimates a margin drop of 5 percentage pointsif it were to offer online through click and collect only.

“Inditex has the infrastructure and IT capabilities fromacross its other brands to make online work for a budget brand.Primark would have to set it up from scratch,” said SocieteGenerale analyst Anne Critchlow.

Inditex did not say whether it planned to expand onlinesales to other countries where Lefties has a presence. A companyspokesman declined to comment further.

The Lefties site, which does not deliver outside Spain orPortugal, offered a standard delivery fee of 3.99 euros. Atsister site Zara, deliveries are 3.95 euros or free forpurchases over 30 euros in Spain.

($1 = 0.8474 euros)(Reporting by Sonya Dowsett; Editing by Mark Potter)

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