Isidoro Álvarez, president of El Corte Inglés between 1989 and 2014, nephew of its founder, Ramón Areces, and great promoter of this company, said that “department stores traveled poorly.” The facts confirm these words, since there have been few incursions of these megastores into countries other than the one of their origin and, when they have done so, they have ended up giving up their international adventure. At best, only their fashion brands have traveled. The internationalization of a department store is much more complex than in firms that only sell fashion. «For example, you need between 500 and 1,000 people to provide service to a single center and a premises or building of about 40,000 square meters, and that is very complicated and makes expansion to other countries difficult, in addition to exclusive agreements with brands that already exist. «They have the department stores in each country,» they explain from El Corte Inglés (ECI). The distribution giant – which this week has been in the news for the departure of the head of the stores, José María Folache, in a decision made by the new CEO, Gastón Bottazzini—has an Iberian will (Spain and Portugal), store experience and a commitment to online sales that places it in second position in Spain, although very far from the first, the multinational Amazon. However, the group is picking up its international presence and, although it will not be the main pillar of its new 2025-2030 strategic plan focused on growth, it is increasing its presence abroad in several ways. Five years of spending control are left behind. and search for efficiency led by its president, Marta Álvarez. In the 2023-2024 financial year, net profit reached 480 million euros, its best result in three decades, with the exception of 2022 when it earned 870 million from the capital gains generated by the sale of its insurance business to Mutua, in an operation which was valued at 550 million. Divestment operations like this have allowed it to reduce its debt to 2,059 million euros (the lowest in 16 years). Tightening its belt last year earned it the rating agencies Standard & Poor's and Fitch Ratings granting investment grade to its debt. The simplest and most feasible path to internationalization is that of its own fashion brands, where Sfera stands out. . It is present in 17 countries with more than 520 points of sale, of which 10 are located in Portugal, 55 in Mexico (through agreements with Liverpool stores) and 287 in other countries. Under a franchise regime, Sfera has a presence in Switzerland, with 53 points of sale; in Thailand, with 43, and in Ireland, with 22, among other markets. In Latin America, where the fashion brand has a wide presence, Chile stands out, with 62 franchises; Peru, with 45; El Salvador, with 13, and Guatemala, with 10. It also has stores in Paraguay, Nicaragua, Costa Rica and Panama. The United Arab Emirates and Qatar also have Sfera fashion, although last year the brand left the Greek market. “In the last year, 37 points of sale have been opened and the focus has been placed on the progressive renovation of all international stores,” they explain from ECI. The company does not disclose specific billing information for Sfera. Of course, Mexico is its third largest market after Spain and Portugal. In terms of employees, which amount to 81,714 people, Spain contributes 93.1% of the total workforce, with Portugal in second place with 4%, and Mexico with 1.8% of workers. The remaining 0.9% is distributed among 23 countries where department stores have a presence. The franchise system distorts these figures somewhat, although given the heavy labor force in the Iberian Peninsula it would move a few tenths at most. Another of ECI's international businesses comes from the travel division. Viajes El Corte Inglés, owned 80% by ECI and 20% by Logitravel, had a turnover of 3,600 million euros last year and is present in 18 countries where its services are marketed: 540 agencies in Spain, 181 of its own international agencies and 1,844 associated agencies. . Its strongest position is concentrated in Spain, Portugal and Italy, but the great growth in Latin America stands out. Mexico is once again the most important country on the American continent for Viajes El Corte Inglés with 106 branches, although its presence extends to 11 countries, with most activity in Panama, Colombia, Ecuador, Peru, Chile, Uruguay and Argentina. As with Sfera, Viajes El Corte Inglés also bases its implementation on its own stores and through agreements with strategic partners in different countries. The company highlights that its travel division “is number one in the Latin American world.”
plastic money
Another international leg comes from the financial business and more specifically from the El Corte Inglés card. It was the first credit card implemented in Spain – before the arrival of Visa, Diners or Mastercard, among others – to be able to pay in installments in the distribution giant's stores. Since 2022, this card has become international following the agreement with Mastercard, allowing its users to pay at any ECI point of sale or any other establishment in the world. Although there is still no data on how it will impact the business, expectations are good, since three million people have used it, of the 11 million who have this means of payment. On a more residual basis to other businesses, ECI It is also internationalizing its food business, although with a high-level focus. El Corte Inglés Selection and the Club del Gourmet are present in Belgium, Mexico, Paraguay, El Salvador, Guatemala, Nicaragua, Costa Rica and Saudi Arabia with high quality products, focused “on making Spain known as a tourist destination,” they explain from the company.
A magnet for tourists
A more sui generis internationalization is experienced by ECI in its Madrid centers of Castellana and Serrano, Marbella, Diagonal in Barcelona and Lisbon due to tourist consumption. Foreign clients contribute almost 10% of the group's total turnover. Thus, according to company data, foreign purchases last year amounted to 1,500 million euros compared to a total turnover of 16,330 million. One of the clearest bets has been the use of payment systems used by Asian buyers such as Alipay+ or WeChat Pay. “We have services highly valued by non-EU tourists, such as carrying out the VAT refund process in all our centers, as well as interpreters, specialized attention or VIP rooms,” explain sources from the chain.