Zara Essay

2689 Words Sep 23rd, 2011 11 Pages
CRAM Exclusive
Essay Sample
ZARA:  History and Background Inditex is a global specialty retailer that designs, manufactures, and sells apparel, footwear, and accessories for women, men and children through its chains around the world.  Zara is the largest and most internationalized of the six retailers that Inditex owns:  (Zara, Massimo Dutti, Pull & Bear, Bershka, Stradivarius, and Oysho).  By the end of 2001, Zara operated 507 stores around the world, including Spain. Of Inditex’s total employees, over 80% of them

middle of document…

As in the product positioning map, Inditex's flagship brand, Zara, is relatively perceived as more fashionable than all the other three and prices less than Benetton and Gap but higher than H&M. In these four competitors, Benetton and Gap place at relatively less fashionable and higher price, while Zara and H&M is more fashionable and price lower.

In Appendix 1 which analyzed the operating and financial performance of the 4 companies in the year of 2001, we can see that H&M is the closest competitor in many dimensions, such as ROE, Gross and Net Profit Margin, etc.  Also, H&M's focused approach to international market is more similar to Inditex's expansion style than the other two closest competitors.

Business Model of Zara

As the largest and most internationalized brand of Inditex's chain, Zara is the principle driver of the group's growth and play the lead role of Inditex's sales and profit.  Zara's unique business model brings special interest of business studies and is often sited as "Dell in the fashion industry".
The core concept of Zara's business model is they sell "medium quality fashion clothing at affordable prices", and vertical integration and quick-response is key to Zara's business model.  Through the entire process of Zara's business system: designing, sourcing and manufacturing, distribution and retailing, they presented four fundamental success
CRAM Exclusive
Moon55812Angel

Related Documents

  • Essay Zara

    During the next ten years after the expansion of Zara in Spain, and after Spain’s insertion in the European Union, this brand opened stores in Porto (1988), New York (1989) and Paris (1990). In addition to this brand, Inditex owns eight other clothing chains: Pull & Bear, Massimo Dutti, Bershka, Stradivarius, Oysho, Zara Home and Uterque - boasting 6.570 stores in 88 markets and more than 133,400 employees. Today there are 2000 Zara stores and 164 Zara Kids stores around the world. Zara’s online retail

    Words: 4860 - Pages: 20
  • Zara Essay

    current presence in over 73 countries. Zara stores are company-owned, except where local legislation forbids foreigner-owned businesses; In those cases, Zara franchises the stores. PRODUCT AND SERVICES * “Creativity and quality design together with a rapid response to market demands” * Mainly focused on clothing but spreading its activity in homeware and related items * From grandmother to grand-daughter, a catalog for everyone * Zara stores have men's clothing and women's

    Words: 7482 - Pages: 30
  • Zara Essay

    away if demand is low. Furthermore, it is responsive to the fickle nature of the fashion market if a new trend comes into fashion zara need to be able to adapt their quickly and change their in store merchandise to meet customer demand. How does the frequency of replenishment affect the design of Zaras distribution system? The frequency of replenishment has made zara increase the size and also centralise its distribution design by handling its global operations through 8 Distribution canters based

    Words: 654 - Pages: 3
  • Zara Essay

    pts.  Zara utilizes the Corporate VMS.  Zara has become the world's fastest-growing fashion retailer.  They are faster, more flexible and more efficient.  Zara can take a design given to them from stores and have it to the stores for their shelves in two weeks time. Jeff Bolling MKTG 310 I 28 Apr 2011 WK 5 Zara Case Study (continued) 4.  Does Zara experience disadvantages from its “fast-fashion” distribution system?  Are these disadvantages offset by the advantages? 4 pts. Yes Zara does experience

    Words: 625 - Pages: 3
  • Caso Zara Essay

    La noticia de hoy trata sobre la diferenciación en la estrategia de Zara con respecto a sus competidores, como puede ser H&M. La ventaja competitiva de Zara, en parte, está en la logística, producción just in time, tiene la capacidad de renovar completamente todo lo que hay en sus tiendas en unas pocas semanas. Inditex tiene también la ventaja de su almacenaje en Europa, en Zaragoza, sus competidores no han visto las ventajas de un centro logístico relativamente cercano a los puntos de distribución

    Words: 8798 - Pages: 36
  • Essay on Management and Zara

    overseas to observe fashion shows and fashion fairs in major cities like Paris, Milan and London. Zara goes to the extent of hiring people in each country where they own retail stores in order to keep track of new trends among potential customers and relay them to their key suppliers. Zara has developed and maintained a good company culture and experiences very low sales manager turnover. Weaknesses: Zara lacks a clear succession to its upper management. This can prove disastrous to its future if the

    Words: 1511 - Pages: 7
  • Zara Company Essay

    precios asequibles Por tanto la brújula que guía al éxito a esta empresa no es otra que sus propios clientes, son estos los que mejor saben lo que quieren en cada momento, Zara les escucha y lo convierte en realidad en unos pocos días, lo que tarda en llegar a sus tiendas repartidas en todo el mundo. La estrategia que utiliza ZARA, para aumentar la rotación de productos y reducir los costes de almacenaje, es la de refrescar la oferta continuamente. De esta manera, se genera un estímulo en el cliente

    Words: 1098 - Pages: 5
  • Marketing Zara Essay

    big brands like Zara are very popular in these eastern countries. The marketing orientation for Zara in China or Japan is classified as high street apparel, expensive, leading fashion brand. That is also why the number of stores Zara opened in China increasing rapidly. In Europe, where Zara originally come from, Zara is not as expensive as it is internationally. Europe is the hometown of top brands; instead of competing with luxury brands like burberry, Chanel, Louis Vuitton, Zara locate its market

    Words: 1646 - Pages: 7
  • Zara Case Essay

    In addition, the infrastructure that Zara has to build to support its operations is a point of competency for the company. First, the managers need to know more about the market and customer demand. As a fashion company, the customer demand should mainly focus on customer’s tastes and most population fashion style. Second, the ability of managers to coordinate activities worldwide is also necessary. The main idea of Zara is to make sure no other company can produce new fashion design to stores

    Words: 613 - Pages: 3
  • Essay on Zara Supply Chain

    While Gap brands, Zara intrigues. We argue in this paper that the success of Zara is explained by a business approach in which a highly automated and largely local production and distribution network facilitates very fast response times as the key competitive advantage, and that this design can be due to cultural and market characteristics of Spain. History The founder of Zara, Amancio Ortega started a small garment factory in La Coruña, Galicia in 1963. In 1975 Ortega integrated downstream by

    Words: 2403 - Pages: 10