The Strategy Of Zara Essay

2144 words - 9 pages

The Strategy of ZARA

Prepared by
Frank Li
090107
Jilin University---Lambton College
May 13, 2013

Prepared for
Program Committee
Northwood University/ Jilin University---Lambton College

Letter of Transmittal
Room 612, Qianjin Street, Changchun City, Jilin Province,
130000, P. R. China.
May 13, 2013

Program Committee
Northwood University/JULC
4000 Whiting Drive
Midland, MI, U.S.A.
48640-2398

Dear Program Committee:
Here is my report, “The Strategy of ZARA”, which you asked for on July 12, 2013. 
As we all know, the global apparel market is a consumer-driven industry.
...view middle of the document...

 

Key Words: global market, retail industry, unique business model

TABLE OF CONTENTS
Letter of Transmittal……………………………………………………………..……2
Executive Summary…………………...………………………………………………3
1. Introduction……………………………………………………………………….5
1. Purpose……………………………………………………………….……….5
2. Background………………………………………………………….………..5
2. Procedure and Findings……………………………………………………………7
2.1 SWOT Analysis……………………………………………………………….7
2.2 4Ps Analyze …………………………………………………………………10
3. Conclusions………………………………………………………………………12
References……………………………………………………………………………13

1.0 Introduction
1.1 Purpose
As a fast fashion of the global retail market, ZARA is a famous and successful case in the international market.
To prove Zara has the prospect of sustainable growth in the international apparel market, it is important to understand and compare the financial differences of Inditex, its parent company, and its major competitor. 
1.2 Background
The global apparel market is a consumer-driven industry. Also, globalization and new technologies have allowed consumers to have more access to fashion. As a result, consumers are changing, competition is fierce, and companies are evolving to meet these demands.
Zara, a Spanish-based chain owned by Inditex, is a clothing retailer who has taken a new approach in the industry. Zara stores are company-owned, except where local legislation forbids foreigner-owned businesses. It was first open in 1975, originally a lingerie store, and then the product range expanded to incorporate women’s fashion, menswear and children’s clothes. By utilizes the prestigious name of both the company and its excellent clothing labels and specific marketing strategy, Zara has more than 2 thousand stores located in 68 countries around the world. ZARA are beloved by all fashionable youths, excellent design plus low price, it seems to make the chance for common people to hug the high fashion.

By targeting a broad market Zara has an international advantage over its competitors. Zara’s target market is very broad because they do not define their target by segmenting ages and lifestyles as traditional retailers do. Zara’s target market is a young, educated one that likes fashion and is sensitive to fashion.

Zara is growing. It has the potential for sustainable growth due to its competitive advantage and its ability to face the challenges of the apparel industry. The company keeps its operating income elevated, has a strong and unique business model, and has various opportunities for expansion in the retail industry.

2.0 Procedure and Findings

2.1 SWOT ANALYSIS
Strength
One of notable strength for Zara is its rapid response in customer trends in fashion. Although Zara only spend less than 0.5% of total revenue on information technology, it works well. In addition, Zara utilizes human intelligence and IT in order to have a hybrid...

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