Zara has shut down its iconic five-story flagship store at Flora Fountain in South Mumbai, citing high operational costs. The store, housed in the 119-year-old Ismail Building, had been a fashion landmark since its grand opening in 2017.
The Spanish fashion giant, operated in India by Inditex Trent (a JV between Inditex and Tata Group), vacated the space after rent soared to ₹3 crore per month, making the location economically unviable.
Despite being Zara’s largest overseas space transaction, only three of its five floors were used for retail, with the rest remaining vacant.
The Ismail Building, restored before Zara’s entry, will soon welcome a new tenant—Pernia’s Pop-Up Shop, a luxury fashion retailer owned by Purple Style Labs.
Leader’s Insights on the Store Closure
According to a LinkedIn post by Shikha Seth, Brand Head, Reliance Retail, there are numerous reasons why many brands are shuttering stores worldwide. She writes, “Foot traffic is declining. E-commerce is dominating, consumer behavior is unpredictable, and supply chain disruptions are shaking up the industry.”
However, she goes on to explain that “retail isn’t dying – it’s transforming.” She writes in her post: Zara is betting on the future: AI-powered recommendations, Augmented reality (AR) for virtual fitting rooms, Data-driven pricing & inventory. And they’re not the only ones.
Zudio is disrupting fast fashion by leveraging trend-spotting AI to bring runway-inspired styles to stores faster and at affordable prices. Tata Cliq is using predictive analytics for better inventory management.
Aditya Birla Fashion & Retail is integrating AI to enhance omnichannel shopping experiences and Nykaa is using AR to transform online beauty shopping.
Brands that embrace AI, predictive data, and digital-first experiences will win. Those that don’t? They’ll struggle to keep up.”
