Europe’s leading online shop for shoes and fashion successfully concluded the business year 2012 and continues to deliver unprecedented growth. With net sales of 1.15 billion EUR Zalando was able to more than double sales compared to the previous year (2011: 510 million EUR), according to the company’s preliminary figures. At the same time, Zalando reached break-even (EBIT) in its core region Germany, Austria and Switzerland (“DACH”) and continued to invest into new markets as well as assortment, proprietary logistics and IT.
Zalando is Europe´s fastest growing company
Zalando is the fastest European company ever to reach more than one billion EUR in net sales only four years after being founded. Robert Gentz, Founder and Managing Director of Zalando, commented: “We are very proud of the remarkable achievements we made as a team. This development reaffirms our business model and our investors’ trust. Zalando is a true European success story.”
Zalando‘s sales grew at a rate of 125 per cent compared to 2011. This increase can be attributed to rising demand in all existing markets including Germany, as well as the addition of seven new countries in 2012, extending the company’s reach to 14 active markets overall. “By launching shops in several new countries we have now established a broad footprint. This will be the basis for Zalando’s growth for the years to come,” added Robert Gentz.
Zalando reaches break-even in its core region DACH (Germany, Austria and Switzerland) and continues to invest into international expansion
In 2012, Zalando proved its capability to combine very strong sales growth with a continued path to profitability. In the most established region DACH, which generates the majority of net sales, Zalando reached break-even (EBIT) while continuing to grow at high rates.
At the same time, Zalando invested into the international markets to further strengthen its leading position in Europe. As a result of this strategy, the Berlin-based company closed 2012 with an improved overall EBIT margin of minus eight per cent of sales (2011: minus twelve per cent).
“Set-up costs are taken into account and part of our strategy for all market entries. The important part is that we see a positive margin trend in all regions as customers are loyal and efficiency is improved,” explained Rubin Ritter, Managing Director at Zalando. “The fact that we reached break-even in our core region already in our fourth year proves the success of our business model and has encouraged us to invest even faster into building leadership in the international markets,” continued Ritter.
To drive future expansion, Zalando remains financially well-equipped. “In 2012, we further increased Zalando’s equity ratio to more than 50 per cent from 39 per cent back in 2011. We follow a fast growth path, and always have countered this with a very conservative balance sheet,” emphasized Rubin Ritter.
Zalando was able to win three new high profile shareholders in 2012: DST Global, J.P. Morgan Asset Management and Quadrant Capital. Swedish investor AB Kinnevik increased its share, becoming the largest shareholder. Additionally, Zalando has agreed on debt financing of 40.7 million EUR with the Commerzbank and the Sparkasse Mittelthüringen.
Zalando successfully enters seven new markets and continues to invest in assortment, proprietary logistics and IT
In 2012, Zalando not only invested into seven new countries, but also built new capabilities to assure sustainable structures and further enhance customer satisfaction. As a result, more than ten million customers have ordered fashion at Zalando until today. The e-commerce company continued to extend its assortment, which now offers customers to choose of more than 150,000 styles from current collections offered by more than 1,500 brands
“It’s our goal to be the preferred online shop for fashion and shoes in each of our European markets. To keep growing at this speed, we continued to improve our offer to the customer by extending our brand portfolio to an incomparably international selection along all categories in fashion, shoes and sports. We broadened our in-house designed labels, and engaged more shops in the partner program adding to a better availability and broader selection,” said David Schneider, Founder and Managing Director at Zalando.
“Our goal is to keep focus on the best fashion offer, the most advanced technology with great functionality of our web shop and proprietary logistic infrastructure enabling fast delivery and excellent service. We do not only want to grow fast, but also to become better in what we deliver to our customers.”
In order to further improve convenience, investments were made into building in-house logistics competence, launching one of the largest European fulfillment centers in Erfurt/Germany. The same applied in the field of IT, where Zalando built one of Europe’s largest technology teams with about 300 IT specialists.
About Zalando
Zalando is Europe’s leading online retailer for shoes and fashion. Its extensive selection for women, men and children ranges from popular high street brands to much sought-after designer labels from over 1,500 different international brands. Exclusive accessories, beauty essentials and sportswear make up Zalando’s wide range of products. A combina-tion of unique services: free delivery and returns, a free service hotline and a 30 day returns policy make online shopping at Zalando an easy and secure shopping experience.
With its own fashion blog, Facebook and Twitter accounts, Zalando provides customers with current fashion trends, product updates and news about the company. The company was founded in 2008 by Robert Gentz and David Schneider, and its headquarters are located in Berlin. Following on from its success in the German market, Zalando entered Austria in 2009 as first international market.
The Netherlands and France followed in 2010. Italy, Great Britain and Switzerland opened its shops in 2011. In 2012 alone, Zalando has gone live in Sweden, Belgium, Spain, Denmark, Finland, Poland and Norway.
