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Extensive SWOT Analysis of El Corte Inglés – The Biggest Department Store Group In Europe

Updated on: Feb 23, 2022
SWOT Analysis of El Corte Inglés - Featured Image

Earlier we did a SWOT Analysis of Sam’s Club, an only membership retail warehouse club. This time we will conduct the SWOT Analysis of El Corte Inglés.

El Corte Inglés is one of the world leaders in department stores and a benchmark of Spanish distribution. They have been operating since 1940 and have seen some great achievements throughout their long journey and their future looks just as bright. Why? Because they have remained authentic and true to the customer’s choice and needs.

Another factor that helped El Corte Inglés remain a giant has been its marketing efforts. As the world switches to the virtual model in the current scenario and if you are interested in learning about the latest – check out our Free MasterClass on Digital Marketing 101 by the CEO and Founder of IIDE, Karan Shah.  

Do you want to know how El Corte Inglés became so successful in the retail industry? In this blog, we will learn the SWOT Analysis of El Corte Inglés and decode the answer. But before digging into that, let us learn more about El Corte Inglés as a company, its founders, products, competitors and other details.

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About El Corte Inglés 

SWOT Analysis of El Corte Inglés - El Corte Inglés Store

El Corte Inglés is the largest department store group in Europe, headquartered in Madrid, Spain. It stands among the third-largest department store groups worldwide. The products of El Corte Inglés range from clothing, footwear, accessories, bedding, furniture, jewellery, beauty products and more.

El Corte Inglés journey began initially in 1934, Ramón Areces Rodriguez and Cesar Rodriguez Gonzalez, bought a tailor’s shop and made it into a limited company.

Areces had travelled to Havana, Cuba and worked at the famous retail chain Almacenes El Encanto, where he learned about the basics of the department store business. In 1940, he established the tailor’s shop into the current corporation El Corte Inglés.

Quick Stats on El Corte Inglés
Founder Ramón Areces, César Rodríguez
Year Founded 1940
Origin Spain
No. of Employees 80,814+
Company Type Public
Market Cap N/A
Annual Revenue €13.128 Billion (2020)
Net Income/ Profit €258 Million (2018)

 

Products of El Corte Inglés

El Corte Inglés deals with the selling of products related to:

  • Clothing
  • Footwear
  • Accessories
  • Bedding
  • Furniture
  • Jewellery
  • Beauty products
  • Housewares


Competitors of El Corte Inglés
 

El Corte Inglés deals with different competitors in the retail industry sector on a global level. 

  • Aldi
  • Walmart
  • SEPU


Now that we have had a look at the company overview, let us move on to understanding the SWOT Analysis of El Corte Inglés.


SWOT Analysis of El Corte Inglés

The SWOT analysis framework allows a company to discover internal strategic elements such as strengths and weaknesses, as well as external strategic elements such as opportunities and threats. The purpose of conducting a SWOT analysis of El Corte Inglés is to help the organization analyze the business environment and formulate strategies that can aid in the growth of the company.

To better understand the SWOT analysis of El Corte Inglés, refer to the infographic below:

SWOT Analysis of El Corte Inglés - SWOT Infographics of El Corte Inglés

Now first let’s begin with the strengths of the company from the SWOT analysis of El Corte Inglés.

Strengths of El Corte Inglés

A company’s unique capabilities, ideas and strengths always give it an upper hand in many aspects. Listed below are some strengths of El Corte Inglés:

  • Distribution and Reach: El Corte Inglés is one of the biggest department store groups in Europe established in the last 80+ years and also ranks among the top five globally. Its great reach and networking ensure its products are easily accessible all around Europe.
  • Financial Position: El Corte Inglés has a strong financial base in Spain, the financial flexibility provided by an unencumbered real estate asset base and comfortable liquidity. 
  • Varieties of Products: El Corte Inglés offers a range of product suppliers in various stores. For example, clothing, footwear, bedding, furniture, jewellery, beauty products, and housewares and hence we can see a huge diversified product in stores.

SWOT Analysis of El Corte Inglés - El Corte Inglés Website

  • Successful Indulging of E-commerce: El Corte Inglés has successfully recorded 750+ million visitors to its website which makes El Corte Inglés website www.elcorteingles.es become the most visited Spanish commercial website in Spain.

The reason behind the success of El Corte Inglés is its successful efforts in implementing digital marketing to its business. Their team is dedicated to making effective marketing strategies day on day. If you want to grasp the latest knowledge in digital marketing then our short term courses in digital marketing are the best you should check out. 

  • Digital Efforts: As said above, El Corte Inglés has become successful in the market due to its constant development and change to more personalised communication with digital users. Their digital applications like El Corte Inglés Plus and Click&Express has introduced easement and helped increase the business 2x more than before.
  • Innovation is its Strength: Through new initiatives, partnerships, business lines and services the company constantly strengthens its commitment to innovation and technology. To maintain its commercial and service offering to its customers, it constantly searches and develops new concepts and services.
  • High Level of Customer Satisfaction: Their 6-way commitment including choice, specialisation, quality, service, innovation and guarantee has resulted in a devoted customer base. Their CRM strategy has led to increased levels of customer satisfaction, making them a valued company.
  • The Boom in Organic Products: Many consumers across the globe have become conscious about their eating habits and have shifted to organic products which is why El Corte Inglés this time also came ahead and launched its unique line of restaurants named Puertalsol and Las Nubes de Castellana dedicated to selling organic products, such as La Biosfera.


Weaknesses of El Corte Inglés

Weaknesses are an integral part of any organisation and hence require improvement. The weaknesses of El Corte Inglés are as follows:

  • Improper Financial Plan: The company needs to see that its flaws are in front of investors and the public which is going to be a downfall for the company’s market cap. Financial planning is not done properly and efficiently. The current assets ratio and liquid assets ratio suggest that the company can use the cash more efficiently than what it is doing at present.
  • Inventory Management: The firm has very poor inventory management. It has to work a lot internally otherwise it may fail to retain customers.
  • Global Presence: Exclusively, El Corte Inglés exists with 599 branches worldwide, 506 of which are in Spain and 93 abroad, whereas other competitors have a strong global presence in terms of stores. 
  • Product Uncertainty: A few products have a large market share, while the majority of products have a small market share. El Corte Inglés’s reliance on a few items exposes it to external dangers if these few products fail for any reason.
  • Brand Awareness: Despite being a strong global player, brand awareness is still limited compared to its competitors.
  • Market Growth: Tough competition from global players poses a constraint in market share growth.
  •  


Opportunities for El Corte Inglés

Opportunities are the areas to which the company should pay special attention. The Opportunities for El Corte Inglés are:

  • Latest Items on Auction: So as we all know that trend plays a very vital role in the market. Where every single company wants to adopt new trends and start making a profit out of them. El Corte Inglés can benefit from this opportunity by putting the latest fashion items for auction where trend plays a vital role in sales. 
  • Online Retail: El Corte Inglés can easily do online retail to increase sales of items produced in bulk. Single products are bought in huge quantities which cost less while buying and they can charge for one product at a minimal amount or a fair amount.
  • Home Essentials: Demand for home essentials products is boosted in the US. This change can be a great opportunity for El Corte Inglés as they also deal in home apparel. 
  • Going Global: As we said, El Corte Inglés one of the weaknesses is not being presented globally. This weakness can be an opportunity for El Corte Inglés to research a foreign market and delve into it with the help of its brand image. 
  • New Customers through Online Channels: Over the past few years the company has invested a vast sum of bugs in online platforms. This investment has opened a new sales channel for El Corte Inglés and also opened for those who are not from big cities but they can enjoy these facilities of buying a product from El Corte Inglés. 
  • Research & Development: Research & development provides an opportunity for El Corte Inglés to practice a differentiated pricing strategy in the new market. It will enable the firm to maintain its loyal or potential customers in check with great strategy and lure new customers through other value-oriented propositions.


Threats to El Corte Inglés

Threats are inevitable that is a hindrance to a company’s growth. The threats of El Corte Inglés are mentioned below:

  • Fluctuations in Exchange Rates: Since the company operates in several countries, it is vulnerable to currency changes, particularly given the turbulent political atmosphere in several markets throughout the world.
  • Rising Competition: Nowadays several new companies are entering the market and have also gained a lot of market share. They are gaining the trust of consumers through innovations brought by them. So, if El Corte Inglés does not make its move then it can lose its customers to these new entrants.
  • Frequent Change in Customer Taste: With the speed of innovation, customers are demanding something new day by day, this frequent change in consumer tastes and preferences could become a threat of rising dead stock for businesses like El Corte Inglés.
  • Dead & Old Stocks: There is no regular supply of new or innovative products over the years. The company develops numerous products that are old and often responds to the development by other players. Also, the supply of new products is not regular thus leading to a high and low swing in the sales number over some time.


This ends our extensive SWOT analysis of El Corte Inglés. Let us conclude our learning below.

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To Conclude

El Corte Inglés is one of the leading department store groups. In the SWOT Analysis of El Corte Inglés, we observed that the company has a significant global presence and a diverse range of products that provide its upper hand. 

However, it should work on online reach and network to cater to a wider audience on a global level hence posing stiff competition to its contemporaries.

With the growing demand for digital marketing, companies and organisations should put their best foot forward in winning over customers with their marketing efforts. With the further growing trend of digital marketing, being fully versed in it is necessary for all marketing enthusiasts. If you are interested in learning more, check out IIDE’s 3 Month Advanced Online Digital Marketing Course to know more.

We hope this blog on the SWOT analysis of El Corte Inglés has given you a good insight into the company’s strengths, weaknesses, opportunities and threats.

If you like such in-depth analysis of companies like El Corte Inglés, find more such intuitive case studies on our IIDE Knowledge portal.

Thank you for spending some time with us, do share your opinions on this case study of the SWOT analysis of El Corte Inglés in the comments below.

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Aditya Shastri

Lead Trainer & Head of Learning & Development at IIDE

Leads the Learning & Development segment at IIDE. He is a Content Marketing Expert and has trained 6000+ students and working professionals on various topics of Digital Marketing. He has been a guest speaker at prominent colleges in India including IIMs......[Read full bio]

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