A Spanish retail giant and the world largest fashion chains that is well known across the globe. Zara is multinational fashion company founded by Amancio Ortega and Rosalía Mera in 1975. The company first open its store in La Coruña, Galicia, Spain with the name Zorba which later changed into Zara until now and has successfully expanded throughout Europe, the Americas, the Middle East, Asia, and with its current Headquarters known as “The Cube” based in the same location as the first store.
Zara is part of the Inditex Group along with the other well-known brands such as Pull & Bear, Massimo Dutti and Bershka. As the fastest growing fashion industry, Zara has opened more than 2000 stores in 77 countries and well-known brand image for its high quality fashions with huge range of designs and affordable price. The stores are mostly company owned except in some area that is not possible where its local legislation does not allow foreigner-owned business. While the parent company, Inditex Group has opened more than 6000 stores including Zara in 88 countries.
The founder Amancio Ortega Gaona was the President of Inditex Group and its main shareholders also ranked as the 4th richest person in the world by Forbes in 2014.In 2005, he was replaced with the current CEO Pablo Isla Jose Maria Castilian which started to reconstruct the distribution system to be more efficient. The inditex group’s fiscal report in 2012 shows total sales of $20.7 Billion and Zara represented 66% of total sales which is $13.6 Billion. Zara has employed more than 110.000 workers in 2011. Zara produced a wide range of fashion items such as clothing, accessories, sports, cologne and many else for kids up to adults, male and female. Not only operates in Fashion Indust...
... middle of paper ...
...e its market share, and keep on innovating to provide a better product and service for the consumer.
To expand the business in international scale, it will require high capital to establish. Therefore having investment from outside is crucial to expand rapidly. The company could either go public or private limited to sell their shares in the stock exchange in order to raise funds for expansion. Another way would be franchising, as shown in Zara’s parent company the Inditex Group, they have both shareholders and franchisee across the world that has enable them to succeed in their Internationalization process.
As we can see, Zara possessed many of these factors that enables the company to succeed in fashion industry. Many other successful company has one or many of these factors as well, it just depends on how much efforts are given in these factors by each company.
They have over 678 stores in the United States.The person who first started it his name is
3. Increase sales to current customers by 5% each year by using innovative technology in order to find more efficient ways to distribute and manufacture our products leading to more competitive pricing.
Nevertheless, it must “defend” its current market share if not increase it, by maintaining premium quality and develop innovative products. The marketing mix strategies will effectively achieve targeted revenue and profitability in the near future.
These companies are direct competitors of Macy 's and sell similar items as Macy 's. There are many indirect competitors of Macy 's. The company faces fierce competition from emerging apparel companies such as Forever 21, H&M, Zara. The company also faces major competition worries from Amazon.com and other online retailers which provide convenience to customers and avoid the costs of having a brick and mortar presence (Bailey,
In accordance with Porter’s diamond model, there are six elements that should be considered in learning the context of the organisation (Bakan and Dogan 2012, p.446). The factors of production are involved with labour force, capital and organisational resources. The organisation has been found for a long period. With the smooth development and sufficient experience of operation, the factors of products are kept well by the corporation. The market demand of fashion industry is kept stably. Considering that the fashionable products are capable of achieving repeated and constant consumption, the demand is maintained in a stable and high level (Topshop 2014). In current stage, Topshop is still specialised in designing, manufacturing, and selling the fashion products. The relevant industries have not been developed and covered comprehensively. The organisation has implemented differentiation strategy. That is to say, the ch...
The strongest visual presentation that Zara creates are the mannequins in front of the stores and also standing through the glass windows. Since all of them are wearing the trendies clothing from this season and they all look put together, that draws many people to go in to the store and have a look. Not only they will have one style, there will be many different styles on the mannequins, so it will bring different types of people in.
The business model that sets Zara apart from other clothing retailers is how rapidly the company changes stocks and releases new product lineups. The company averages 12-16 collections annually which equates to more than one lineup a month. Due to stock being limited and the rapid production Zara brings forth, their items are viewed as exclusive promoting further business. Their customers are happy knowing that their specific article of clothing is more “rare” due to only having an average of a two-week window to purchase the clothing. The company specifically targets current trends and has them in the store within 30 days. This maintains the brand’s uniqueness and relativity in fashion.
The first ZARA store opened in Spain in 1975 and it is now the highest profile chain store of its parent group Inditex with over 1000 stored worldwide. Zara unlike H&M have adopted a more vertically integrated business model. 60% of their goods are manufactured in spain whilst only 24% are manufactured in low cost regions like africa and
The fundamental business strategy of Zara is very simple which is linking customer demand to manufacturing, and liking manufacturing to distribution. Zara has been running their business in fashion industry which is susceptible to seasons and quick changing customer tastes. Zara has been approached to and considered their business as a perishable commodity business just like a fresh baked cake or bread to be consumed quickly.
Zara has a great and unique operating strategy which helps them achieve competitive advantage. However, at the same time it lacks the IT support. It needs a good IT strategy that will support its supply chain and enhance their systems in order to support their operational strategy. A fast paced retail company like Zara needs to strengthen its IT system by getting rid of its aging systems. It needs to do this soon before any other company overtakes them in this race.
This brand of shoes is manufactured by the Armani group in Europe and it specializes in fashion shoes for the affluent and fashion-conscious group of people
H&M is the world’s second largest retailer, only behind its main rival Zara of Inditex (Petro, 2012). The company currently has 3006 stores in 53 countries. The company does not own any factories. H&M outsources production to network of 800 independent suppliers; 75% in Asia and 25% in Europe. In order to increase the efficiency and productivity of its supply chain, the company strategically locates its network of 20 to 30 production offices close to its suppliers. According to Stockholm Newsroom, the pretax profit of the company for the month of June to August of 2013 is $907 million, which indicates an 11 rise in turnover (Pollard, 2013). The company continuous development plan facilitates its goal for both brick and mortar, and online stores expansion worldwide. The target segments for H&M, a category specialist store, are trendsetters and fashion/money conscious males and females ranging from 16 to 40 years old with income ranging $15,000 to $60,000 annually.
When it comes to doing business internationally the decision making is more complex. There are many interactions between each country that need to be addressed. In order for a business to be successful in the international market they need to examine and analyze all the facets of their company. They need
Why would a company go international? There are many reasons why companies would go international, but generally a company goes international so they can seek opportunities in domestic markets, or they seek solutions to problems that cannot be solved through domestic operations. There are many profitable possibilities by going internationally and these include greater profit potential, offers new locations to sell products, it may provide better access to needed raw materials, it may access to financial resources from many nations, and lastly it may allow labour-intensive activities to locate in countries with lower labour costs. For a small business to become an international business they must use five guidelines the first is global sourcing, exporting and importing, licensing and franchising, joint ventures, and wholly owned subsidiaries. The first two are market entry strategies and the remaining are direct investment strategies.
Miuccia Prada once said that “What you wear is how you present yourself to the world, especially today, when human contacts are so quick. Fashion is instant language”. Miuccia Prada and the Prada brand have grown from humble beginnings making quality leather goods to a public traded company with a current market capitalization of over $26 billion (USD) . With the development of Prada as one of the world’s premier luxury brands it provides an excellent case study to examine how strategy paved the way for the success of the Prada brand. First, an examination of Prada’s strategic positioning against luxury brand rivals Louis Vuitton Hennessey Moet (LVHM) and Kering (Gucci). The acquisition history of Prada will be reviewed, where some preliminary conclusions can be made about what has been contributing factors to both the successes and failures. Then finally, an evaluation of what the future holds for Prada and the sustainability of its competitive advantage.