Toni Ruiz (Barcelona, 1969) has led the transformation of the fashion company Mango, owned by Isak Andic. Under his direction, the group has recovered financial strength and broke a sales record in 2022, with 2,688 million euros and profits of 81 million. The next challenge: developing the new growth plan.
How are sales this year?
In the first quarter we are seeing the same trend as last year, that is, a very good sales performance in all our markets. We don't see a slowdown in consumption at all. And in Spain we are growing the same or better than the average of the countries in which we have a presence. This indicates that we are doing very well, because fashion in Spain is a somewhat more discretionary product category, which tends to suffer in contexts of economic uncertainty. But as I say, it is not our case.
Do you then expect to surpass the record results of 2022, will they reach 3,000 million in billing?
The improvement in sales is a consequence of being very focused on the product, the value proposition and the client. We work for that and hopefully we get there.
Last year they began an expansion plan in the United States, with significant investments, and increased the debt to 82 million euros, compared to negative eight million in 2021. How are you managing debt in this phase of growth? Will they borrow more?
When I came to Mango in 2015, debt was a problem. Not only because of the volume itself, but because of the proportion with respect to the result that we had. Now it is no longer a problem for Mango. We have enough projects to continue our development and if we have to dump a little debt, it will be welcome in order to grow and gain market share. Last year we invested 107 million and this year the figure will be higher.
In the last presentation of results, he commented that they want to place the United States among their five main markets. Will this exercise already be?
It will undoubtedly be among the most relevant markets for Mango, in the top 5 or top 3 in the coming years. We currently have ten stores in New York, with a flagship on Fifth Avenue, and in Florida. Now we are going to continue opening points of sale, in Texas, Georgia or California. We have a great growth opportunity in the United States.
What are your plans for Spain?
Spain is our main market, but we only have, in quotes, a 3% share. So we can grow much more. At the end of 2022 we had 375 points of sale in Spain, of which 225 were our own stores. This year we will continue to expand throughout Spain to gain capillarity by opening new points of sale and renovating some fifteen stores to adapt them to the new New Med concept, already present in some of our flagship stores around the world. We plan to open between fifteen and twenty new points of sale this year in Spain, in cities such as San Sebastián, Oviedo, Sant Cugat, Mataró, Castelldefels, Olot, Granada, Gijón, Úbeda or Mérida. We will also expand our presence in airports, with an establishment in Tenerife Sur, which we will add to those we already have in El Prat, Barajas, Palma de Mallorca and Seville.
Direct operations in Russia have ceased, but franchisees continue to operate there. Do you anticipate any changes?
We have already announced the cessation of our direct operations in the country, and now some franchisees continue. We do not anticipate changes in this regard. In the Ukraine, where we closed the stores at the beginning of the war, we have already opened most of the stores. The local staff asked to return to normality, to return to work.
Mango's average ticket has increased. Is it now a more expensive brand?
We are not a more expensive brand, but we have strengthened our own style, the quality of the garments. Now we have higher quality garments with a higher average price and we are seeing that they are very successful. We've just done a couple of releases that have worked very well. They are garments that have been designed in 3D, for events, at a higher average price. And they have been very well received. We detect that people want higher quality and much better designed garments. We are not a clothing brand, we do not make clothes, but fashion. But we are still an affordable brand.
¿Se consideran fast fashion ?
Absolutely. We have a team of 500 people who design 100% of the garments in Barcelona, who are defending an increase in quality, with better and more sustainable fabrics. We are far from fast fashion clothing and we want to get further and further away from this model. In the sector we are seeing companies that have not been able to strengthen their position and are really losing many customers, who are losing their raison d'être. We have seen it in France with historical companies. In the end, if you don't know how to renew yourself, if you don't know how to maintain your DNA, if you don't have that differential positioning, you end up being a commodity. Mango is gaining market shares because our proposal is good, because we maintain our DNA.
Are proposals like Shein's, with strong penetration in Spain and all of Europe, a threat to companies like Mango?
There have always been companies that have been entering the lower segment and that has nothing to do with what we do. I insist on our positioning, which is very clear and differential and therefore there will always be brands that make cheap clothes. It's not our customer segment at all.
The textile industry is one of the most polluting in the world and now the EC is preparing a legislative battery that will force the introduction of new sustainability criteria. How do they face this challenge?
Sustainability is a fundamental issue, it is one of the biggest challenges we have in the sector and it must be addressed both individually and jointly. The legislation will help a lot because it will set sustainability standards for the entire industry. We have the challenge of recycling, of the extended responsibility of the producer. Surely the garments will also have to be designed in a different way, in a circular way, with less mixture of fibers, to facilitate recycling, and traceability will have to be promoted. At Mango we have made a real commitment to reduce emissions, we have made progress in traceability, with the publication of our suppliers, and we have increased the use of sustainable fabrics.
How do you want Mango to be in five, ten years?
We want to continue to be very relevant to our clients. We think we have a very attractive value proposition and we want to continue expanding it around the world, and be more relevant in the markets where we already have a presence, which currently number 115. Second, the sector is changing and transforming. I would like Mango to be a leading company in this transformation, to help and truly be a pioneer in sustainability, in digitization.
Do not contemplate an IPO?
Mango has done an exceptional job of transformation and has a very ambitious growth project. We have a shareholder who is thinking in the medium term, our financial situation is good and we have freedom. The IPO is not on the table.
