Company Analysis: The Company Overview Of Zara

Zara 's combination of cutting-edge fashions and culture lends itself well to a European-style, fashion-conscious consumer. While this type of consumer can be found in New York, this is not representative of the entire US market. Retailers in small towns and urban sprawls rely more on a shopping mall atmosphere. Adapting that strategy would undermine Zara 's image. It is therefore recommended that Zara target only major metropolitan areas which would likely have higher concentrations of fashion-minded individuals.

In 1963, textile manufacturer Inditex is formed by Amancio Ortega Gaona. In the next decade of 1963 – 1974, it distributed many products to the different countries in Europe by setting up number of manufacturing units. In 1975, A Coruña witnessed First store of Zara on Central Street. Over the period of 8 years starting from 1976, business of Zara has grown tremendously and by the end of 8 years in 1984, it has almost acquired Spanish market by attracting majority of the society. Around December 1988, Zara crossed the borders of Spain and started their international store in Portugal (Oporto). Zara opened their international store in USA on the streets of New York in 1989 which was considered to be the next step of Zara of going international and considered to be the second international opening. In 1990, they opened their third store in France (Paris).

* Social - Changes in social trends and in social life can force on the demand for Zara’s products and the availability and enthusiasm people to work. The company must work in relation with costumers need, trends and demand as a result of change in generation choices. Even thought the prices of Zara are relatively low this is a very good point in their favor if they enter in Albanian market. Because Albanian people cannot afford products that have high prices. Zara can be afford from 60% of the population.

Zara’s business model can be broken down into three basic components: concept, capabilities, and value

Zara’s vertically integrated supply chain management has had a great advantage on this retailer’s sales. The risk that other retailers take with trying to predict fashion trends a year in advance is eliminated for Zara. Due to the store’s rapid restocks of new designs every two weeks, customers are introduced to the latest fashion trends. This is a trait that puts Zara above its competitors such as H&M and Gap. Zara possesses a very wide-ranging merchandise assortment sold in stores but produce a low quantity of garments so if an item does not sell as well as they had hoped, they wont lose as much revenue as there is not as much stock to be discounted. This also allows Zara to react quickly and analyze a fast response should the market change rapidly.

Ortega Gaona, CEO, founder, and Spain’s richest man founded Zara in 1975. Zara’s first store was in A Caruna where the headquarters now lay and featured lower priced lookalikes of high end, popular products selling to women, men, and children (Zara (Clothing) 2009). Beginning in the nineteen eighties Zara began experimenting with differentiating the design, manufacturing and distributing progression in order to condense lead times and respond faster to new trends. Gaona considered this to be “instant fashion.” Instead of individuals, Zara used information technologies and groups of designers to base its improvements in fashion. In 1998, the company began its international development through Portugal’s second city, Porto. By 1989 Zara entered the United States and by 1990 entered France. Zara’s international development expanded to Mexico in 1992, Greece in 1993, and Belgium and Sweden in 1994. Zara continued to open stores around the world until there were stores in seventy countries. This includes more than 519 stores in Spain, 116 stores in France, 87 stores in Italy, and 45 stores in the USA (Zara: Cool Clothes Now, Not Later). Zara Performance: Financials: Since Zara is a subsidiary of the parent company Inditex, this report includes some financials about Inditex. According to the

In the future, Zara’s marketing trends is to broaden their target customers who are educated, young, and fashion lover or price-sensitive. According to United Nations (2011), total population in the world has been growing rapidly from 1950 to 2010

Zara is a non-domestic retailer company that offers a wide array of clothing for young adults, children men, and women. The first company store was opened in 1975 in the nation of Spain. However, it has been able to expand its operation in other countries such as United Kingdom, India, Japan, Mexico, and Canada. Zara has been able to maintain its position in the fashion market which is highly competitive as a result of its constant and latest change in trend. The apparel market is usually driven by the consumer (Zara Website). Based on the fact that new technologies and globalization have availed to the customer enhanced and improved access to fashion, the core objective of any organization that is competing in the industries depends on the meeting the needs of the consumers. As such, Zara has focused its attempts on the evolving and developing consumer-oriented product lines as it strives in meeting the needs of customers of different income and age. The middle-aged parents purchase clothes at the retail stores because they are cheap while the children purchase merchandise from the stores for it is trendy and fashionable. The company has a wide array of clothing and product lines as per the market needs. The company has a distinct fashion approach and constant response to the ever-evolving trends. The objective of Zara is relation to combining low prices and fashion, adapting and interpreting the

Differences in positioning also affected the stores which products were sold and ZARA’s overall image. For example in South America, ZARA’s products had to present a high-end rather than a mid-market image and it was emphasized that they were “made in Europe”. However, the image

There has been an increase in mortgage payments as the Bank of England has recently increased the base rate to 5.25%. Most importantly this has an effect on cash outflow, meaning consumers have less to spend on clothes this may leave to a decrease in sales for retailer. The value for the retailing industry has increased, leading to falling prices; die to the immense competition from low prices producers and retailers.

Zara employs one of the greatest and most successful operations strategy in the retail industry is the strategy employed by Zara. Zara being the flagship brand of a Spanish fashion retail giant, Inditex, (Industrias de Deseno Texti S.A.), was founded in 1975 and is engaged in designing textiles, manufacturing and distribution (Dutta. D, 2002). Zara started as a single shop in La Coruna but rapidly expanded to 68 countries. The company primarily operates in the Europe zone, where about 80% of its sales are made with LaCoruna, which is still home of its central offices. Its stores are opened each day and known as one of the fastest growing fashion retailers in Europe. Zara’s entire business operations, designing, sourcing, manufacturing, distribution process and retailing, it gained a couple of successful factors that include: a

Zara is a brand widely known across the globe for its unique fashionable cloths .It is a part of inditex which is known as one of the world’s largest distribution group in the world and the owner of the company is Spanish businessman named Amancio Ortega .This company was formed in 1963 as a fashion retailer for women clothes but the company became a success after the addition of a new brand named Zara in 1975 .Today Zara is amongst one of the largest international company producing the fashionable clothes. After the success of the inditex as a successful brand (ZARA) maker, inditex was able to expanded itself with more successful brands across the world in different countries at the end of the 1980.from 1976 to 1983 Zara turned out to be a successful retailing brand and introduced itself with nine new outlets to the biggest cities of the Spain with its first headquarter in Goa. Year 1984 turned out to be the witnesses of first logistics headquarter of Zara covering a large area of 10,000 square metres. New York

Amancio Ortega, had a simple idea of linking customer demand to manufacturing and manufacturing with distribution, when creating ZARA in 1975 in la Coruña, Spain Zara came under the holding company Inditex in the year 1985 and is today the biggest fashion brand of the group. Zara believes that the prime factors for running a successful business are quick response to customers, use of computers, and disintegrated decision-making (McAfee, Dessain, & Sjoman, 2007)

Today’s fashion market is highly competitive and companies need to always be up to date. Zara has many competitors such as H&M, Mango and Gap. The successful concept of “Fast fashion” has created many retail stores to change their retail strategy but have not yet to compete with Zara system.

The basic strategy for fighting competition is to attract buyers at lower prices, more unique designs, high-quality design, efficient customer service and solid image brand. Thus bargaining power of buyer for apparel industry is high as the products falls under the basic needs in human lives. There is no much difference in terms of products offered by the apparel company, so if buyer is unhappy with the product or service they can easily switch to another brand. Thus, Zara are trying to strengthen its position in the market by using their unique strategy by giving priority to buyer to meet their special needs.