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A Spanish business giant: How did El Corte Inglés become Europe's largest department store?
El Corte Inglés, headquartered in Madrid, has played a major role in the Spanish and Portuguese retail markets since its founding in 1934 and is now the largest department store in Europe. With its unique business model and continuous expansion, El Corte Inglés is able to survive and prosper in a highly competitive market. What stories and strategies are hidden behind it?
Origins of History
El Corte Inglés' founders, Ramón Areces Rodríguez and Cesar Rodríguez Gonzalez, acquired a ready-to-wear shop in the heart of Madrid in 1934 and transformed it into the department store it is today. This transformation not only marked the birth of the company, but also the beginning of an amazing growth journey.
In its early days, El Corte Inglés' business philosophy was to provide a "one-stop" shopping experience, which was quite novel in Spain at the time.
In 1940, El Corte Inglés moved to a larger space and implemented a business model similar to that of Galerías Preciados, which resulted in an expanded product line that included everything from electronics to food. Over time, El Corte Inglés became not only a retail giant, but also a part of the culture of Spain and Portugal as a whole.
Business strategy and expansion
The key to El Corte Inglés' success lies in its continuous expansion strategy and diversified business model. In 1962, El Corte Inglés began to open new department stores outside Spain. In the following decades, it continued to open new stores, making its brand influence spread throughout the Iberian Peninsula.
El Corte Inglés became the undisputed leader in the market in 1995 through the acquisition of its main competitor, Galerías Preciados.
In recent years, the company has also actively entered the field of e-commerce, providing online shopping services through its website and attracting a large number of consumers. Its website became one of the most popular commercial websites in Spain in 2016. . As e-commerce continues to grow, El Corte Inglés is able to effectively combine online and offline sales to cater to the changing needs of consumers.
Financial Status and Future Challenges
Even so, however, El Corte Inglés has experienced some challenges financially over the past few years. According to the 2020 report, its global retail ranking slipped to 97th, showing the fierce competition in the market. Although the company still maintains a fairly high market share in Spain, it still faces strong competition from other large retailers, especially e-commerce platforms.
SummaryLooking into the future, El Corte Inglés’ challenge is how to effectively transfer its department store technology to digital platforms to adapt to the new generation of consumption patterns.
The story of El Corte Inglés is one of innovation, expansion and business acumen that not only changed the face of retail in Spain but also established it as an international brand. In this ever-changing market, how can El Corte Inglés once again learn from the past and adapt to new consumer demands?
