Zara to end franchise in Finland

Zara parent Inditex is to terminate its franchising agreement in Finland. The Spanish

conglomerate has mutually agreed with Finish retailer Stockmann to end their 10-year Zara brand franchising partnership from March.

Zara currently has four franchised stores under Stockmann's operations in Finland. The stores will be transferred to Inditex through a sale of Stockmann’s subsidiary Z-Fashion Finland that is responsible for the franchising business.

All the current Zara stores and their 180 employees continue as part of Z-Fashion Finland, under the Inditex Group. The divestment will not have a substantial effect on the Stockmann Group's revenue or earnings, the retailer noted.

Revenue of Z-Fashion Finland totalled 22 million euros in 2012.

The termination of the franchising operation is in line with Stockmann’s strategy and enables its department store division to focus on its own core business, it added.