What: OTB Group establishes Mexican subsidiary and partners with El Palacio de Hierro to launch 50 new points of sale for its luxury brands including Diesel, Jil Sander, Marni, and Maison Margiela.

Why it is important: This strategic move demonstrates how luxury fashion groups can leverage established department store networks to rapidly expand their presence in key growth markets while maintaining brand positioning.

OTB Group is making a significant move into the Mexican market by establishing a dedicated subsidiary in Mexico City to oversee its regional expansion. The Italian fashion group, known for its portfolio of luxury brands including Diesel, Jil Sander, Marni, and Maison Margiela, has formed a strategic partnership with El Palacio de Hierro, Mexico's premier luxury department store chain. The collaboration will see the launch of approximately 50 new points of sale over the next five years, extending beyond Mexico City to key regional locations including Guadalajara, Monterrey, León, Cancún, Puebla, and Querétaro. This expansion will be executed through a combination of boutiques and branded concessions within El Palacio de Hierro's network of 31 stores. The initiative represents OTB's commitment to strengthening its presence in North America beyond its existing operations in the United States and Canada, with Mexico being identified as a crucial market for luxury retail growth.

IADS Notes: OTB's strategic entry into Mexico through El Palacio de Hierro comes at a time of significant growth in the country's luxury retail sector. The department store chain has demonstrated remarkable performance, achieving 12% revenue growth and 30% operating profit increase in April 2025, while maintaining its position as the world's second-best department store. The partnership aligns with El Palacio de Hierro's successful track record of introducing international luxury brands, as evidenced by its October 2024 flagship store opening in León, which spans 35,000 square meters and houses over 200 premium brands. The retailer's strong financial results, including 11% revenue growth to $3.2 billion in 2024, and its extensive network of 31 stores across key Mexican cities, provide OTB with a robust platform for establishing its brands in the Mexican market, following similar successful collaborations with prestigious luxury groups like LVMH and Kering.

El Palacio de Hierro partners with luxury group OTB