Zara Fashion Case Study

Fast fashion is getting faster and cheaper, but who bares the cost for the rising demand for this type of clothing? Most of the time, the effects are felt in the countries where the brands are not even sold and where they are produced. Consumerism has a lot to do with the success of stores like Uniqlo, Forever 21 and Primark. These types of stores are making fashion accessible to all, and thus trends are becoming more and more short-lived, making people always wanting newer and cheaper items. Inditex, Zara’s parent company, grew its number of store from 500 in 1995 to more than 2500 in 2015. Hennes & Mauritz (H&M) had fewer than 400 stores in 1995, and now has over 3500 (The Economist, 2014). Most of these brand’s clothing items are so inexpensive

The biggest financial effect was the compensation amounts they were asked to pay to the families of the victims. Among those who paid such compensations, Primark paid the equivalent of nine months salary to 3639 workers and their families (14 million dollars overall) and Joe Fresh (Loblaw’s) donated 4 million dollars to a compensation trust fund, however, only half the businesses involved in the factory that collapse have yet to pay compensations (Strauss et al., 2013). On April 24th of 2013, Rana Plaza, an eight-story commercial building collapsed, it was the deadliest garment factory accident in history and deadliest structure failure of contemporary human history. The building was not only home to clothing factories; it also contained a bank, apartments and other shops. However, following the warnings sent to the owner about cracks in the foundation of the buildings, the bank and the shops were immediately closed, but the workers of the factory of not informed of the conditions; the building collapsed the following day. The factory was home to the production of many well-known brands such as Benetton, Primark and Joe Fresh. Primark, which is owned by Associated British Foods

Nike ranked number one for many key attributes, such as innovation, people management, social responsibility, global competitiveness and quality of products and services (Fortune, 2015). Nike financials suffered from the scandal because it was taken to the US court of law. In 1991, Life Magazine published an article about child labor in Pakistan, where Nike was the number one concerned company. They have allegedly employed children as young as nine years old to produce soccer balls and sports shoes, and had to work exhausting hours in inhuman conditions. Child labor in Pakistan is a very important issue, it has been demonstrated multiple times by international medias, but nothing has been done about it by governments (TED, 1999). According to Unicef, in 2011, there was an estimate of more than thirteen million child working in Pakistan, of those, 73% are boys and 27% are girls (Unicef, 2011). They are working in different industries such as agriculture and manufacturing (Appendix 3). Following the allegations, Nike felt public-relations impacts in the short-run, but in the longer run, the growth sand sales of the company were not affected. Only their image has suffered, but the image customers now have is