...In 1975, appeal giant Inditex set up the first Zara store in La Coruna, in Northwest Spain. By 2006, Zara had owned 723 stores which hold a selling area of 821,100 square meters around the world. With sales of 3.7 billion dollars in the business year 2005, Zara had developed into Spain’s the most famous fashion brand and the leading brand of Inditex (Kumar, 2006). Zara is one of the most outstanding apparel retail businesses in the world today. Although it is not the biggest, its marginal profits and rates of growth are leading the industry. The purpose of this essay is to analyze what sort of innovation Zara used on its way to success and make comparisons of competing products or processes with its competitors. By analyzing and comparing, it is obvious that the company's success depends on conducting a series of innovations at each one of the parts in the business: fashion-forward design, unique branding strategies, in-house production processes and centralized distribution system. Basically, this essay has been divided into four parts: the first part focus on describing how Zara makes its designs more innovative compare with other appeal retailers. Then, what sort of innovation used in their branding strategies will be discussed. Next, it will consider Zara’s innovation of production process and show an apparent difference of this process among Zara, H&M and the Gap. Finally, it will look at how Zara promotes innovation on their distribution process in to become more fast...
Words: 2808 - Pages: 12
...ZARA By Promode Gabriela Andrade Diego Farfán Cristina Neira Gabriela Muñoz SEARCH STAGE About INDITEX Industrias de Diseño Textil S.A (INDITEX) is a large Spanish corporation inside the fashion industry. This group is related with different companies that deal with activities involved in textile design, production and distribution. Amancio Ortega Gaona is the founder and chairman of INDITEX. INDITEX headquarters are located in Arteixo, a village in the province of La Coruña in Galicia, in the north west of Spain. It is there where almost all its merchandises are manufactured. With over 4,430 stores in around 73 countries, INDITEX owns brands like ZARA, Massimo Dutti, Bershka, Oysho, Pull and Bear, ZARA HOME, Kiddy’s Class (Skhuaban), Uterqüe and Stradivarius. These stores are mostly corporate-owned since franchises are only conceded in countries where corporate properties cannot be foreign-owned. Their management model, based on innovation and flexibility, and the company’s achievements, have placed INDITEX as one of the largest groups of fashion distribution. One of the strategies of INDITEX group is to understand fashion, creativity and quality design in order to provide an efficient answer to the demand of the market. This has allowed a fast international expansion and an excellent embracement of this proposal in all different brands that form part of the INDITEX group. About ZARA As mentioned before, ZARA forms part...
Words: 4670 - Pages: 19
...While some of the department stores covered by this Survey beat our same-store sales estimates for the first half of 2011, some lagged behind. (For details, see the “Same-Store Sales of Selected Department Stores and Discounters” table on the previous page.) Most of the moderate-price department stores such as J.C. Penney and Kohl’s fell behind expectations. On the other hand, discounters such as Dollar Tree Stores and Dollar General reported relatively strong gains in the first and second quarters of 2011. The better department stores such as Saks and Nordstrom have been able to attract upper-income households with limited sales promotions, by offering convenience and a superior shopping experience. These stores are sticking to their core strategies: they are actively striving to come up with innovative marketing programs and customer services, and selling exclusive designer products. (Adams Media Research, 2012) [pic] J.C. Penney and Kohl’s both posted modest sales gains in the first and second quarters. While middle-income consumers are showing reasonable caution in their spending behavior, they’re willing to go slightly over budget when the merchandise is right. Overall, discounters exceeded our same-store sales expectations for the first half of 2011, reflecting stable consumer demand for everyday necessities. Among the big box discounters, we believe Target benefited from an expanded assortment of food and allied categories. We also think the company...
Words: 1853 - Pages: 8
...------------------------------------------------- Concept The fashion industry today is in constant flux and is increasingly being driven by consumer demand and not by supply from the manufacturer. This leaves no room for slow-moving businesses. Therefore, our retail brand ‘Diva’ will bring the concept of ‘fast fashion’ to ready to wear western women apparel in Pakistan. Fast fashion is a contemporary term used by fashion retailers according to which the latest trends move from the fashion shows to retail outlets very quickly. These trends are transformed into designs and manufactured quickly and cheaply so that the mainstream consumer can follow current trends at an affordable price. The world clothing and textile industry reached almost $2,560 trillion in 2010 where as the apparel, luxury goods and accessories portion of this market (which accounts for over 55% of the overall market) is expected to generate $3,180 billion in 2015, with an annual growth rate exceeding 4%.With a promising growth rate globally and growing trend of western apparel brands such as Mango, Splash, Quiz, etc in the Pakistani market, it is evident that the Pakistani apparel industry has substantial potential. An increasing panorama of fashion boutiques in Pakistan indicates that a number of people have shown a keen interest in this industry Also, with the emergence of designers in the Pakistani fashion industry it can also be seen that people are becoming more fashion conscious. With all such promising indicators...
Words: 1916 - Pages: 8
...Case 12: Victoria’s Secret - Seeking for new business opportunities in the European lingerie market The Victoria’s Secret (owned by US Limited Brands, Inc.) sells women’s intimate and other apparel, personal care and beauty products and accessories under the Victoria’s Secret and La Senza brand names. Victoria’s Secret merchandise is sold through retail stores, its website, www.VictoriasSecret.com, and through its catalogue. Through its website and catalogue, certain of Victoria’s Secret’s merchandise may be purchased worldwide. La Senza products may also be purchased through its website, www.LaSenza.com. In January 2007, Victoria’s Secret completed their acquisition of La Senza Corporation. La Senza is a Canadian specialty retailer offering lingerie and sleepwear as well as apparel for girls in the 7-14 year age group. In addition, La Senza licensees operate independently owned stores in 45 other countries. The results of La Senza are included in the Victoria’s Secret segment The Victoria’s Secret segment had net sales of USD5.604 billion in 2008 and operated 1,043 stores in the United States and 322 stores in Canada, in total 1365 stores. At the moment it is not possible to buy Victoria’s Secret in European stores, except in a London store and on-line .The top-management has now decided that Victoria Secret’s should expand to the European market and if yes: Which markets should be penetrated and how? First some information about the international underwear...
Words: 1138 - Pages: 5
...Number | Contents | Page | 1. | Introduction to ZaraHistory & Company BackgroundCompany Profile | 23 | 2. | Case Summary : ZARA The technology Giant of the Fashion World | 7 | 3. | Discussion: Question 1Question 2Question 3Question 4Question 5Question 6 | 899101010 | 4. | Conclusion | 11 | 5. | Reference list | 11 | History and Background of Zara Marked as the first prestigious venture of the Inditex group the first store of Zara, the chain of Spanish fashion stores came into reality on central A Coruña Street in 1975. In 1985, Amancio Ortega integrated Zara in a new holding company, Industria de Diseño Textil, INDITEX S.A. The Zara fashion concept was well received by the public later in 1976, allowing it to expand its network of stores to the other main Spanish cities. During 1981-1988 with the growing popularity Zara started new ventures by multiplying in number not just in Spain but around the world. Today Zara is present in 73 countries, with a network of more than 1,540 stores, ideally located in major cities. Its international presence clearly shows that national frontiers are no impediment to sharing a single fashion culture (fibre2fashion.com, 2011). Today Zara is the largest and most internationalized of the six retailers that Inditex owns which are Zara, Massimo Dutti, Pull & Bear, Bershka, Stradivarius, and Oysho (www.zara.com/company, 2011). The role of the corporate centre at Inditex’s headquarters is that of a “strategic controller” only...
Words: 3022 - Pages: 13
...chain is one of them. The Zara fashion chain, founded in 1975 in Arteixo, is perhaps the world's most successful clothing chain. Zara has helped its parent, the Spanish firm Inditex, grow from obscurity in the mid. 90’s to the world's third largest pure-play fashion retailer after the Swedish H&M and US-based Gap Inc. with financial performance well ahead of these rivals. With 1021 shops, at 13.04.2007, in 55 countries, Zara appears to have found the formula for success: Give the public what it wants, at the lowest possible price, in the shortest time possible. In order to think about how the firms achieve sustainable advantage, it's useful to start with two concepts defined by Michael Porter: operational effectiveness and strategic positioning. (I) OPERATIONAL EFFECTIVENESS According to Porter, the reason so many firms suffer aggressive, margin eroding competition, is because they've defined themselves according to operational effectiveness rather than strategic positioning. Operational effectiveness refers to performing the same tasks better than rivals perform them. Everyone wants to be better, but the danger in operational effectiveness is in "sameness". At its heart Zara is building on a vertically integrated demand and supply chain, while most other textile chains rely on outsourcing and cheap labor in China. It enables company to short turnaround times and achieves greater flexibility, reducing stock to a minimum and diminishing fashion risk to the greatest possible...
Words: 1922 - Pages: 8
... Fascicle of Management and Technological Engineering, Volume VI (XVI), 2007 STRATEGY AND SUSTAINABLE COMPETITIVE ADVANTAGETHE CASE OF ZARA FASHION CHAIN Sunhilde CUC, Simona TRIPA University of Oradea, Faculty of Textiles and Leatherworks, e-mail: hectic@rdslink.ro, tripasimona@yahoo.com, Keywords: Company Strategy, Competitive Advantage, Operational Effectiveness, Strategic Positioning Abstract. In this case study we want to analyse this phenomenon called Zara, a strategic unit of the Inditex Group, and evaluate the strategies of Zara on the European fashion market. Finally within the clothing market, it shows the competitive advantage gained through modern systems by comparing Zara to its opponents. 1. COMPANY PROFILE Firms strive for sustainable competitive advantage, financial performance that consistently outperforms their industry peers. The world is so dynamic, with new products and new competitors rising seemingly overnight, that truly sustainable advantage might seem like an impossibility. But there are winners and the Zara chain is one of them. The Zara fashion chain, founded in 1975 in Arteixo, a small town in the north of Spain, is perhaps the world's most successful clothing chain. Zara has helped its parent, the Spanish firm Inditex, grow from obscurity in the mid 90s to the world's third largest pure-play fashion retailer after the Swedish H&M and US-based Gap Inc. with financial performance well ahead of these rivals. The Inditex Group is present in...
Words: 2027 - Pages: 9
...Zara | One global retailer is expanding at a dizzying pace. It's on track for what appears to be world domination of its industry. Having built its own state-of-the art distribution network, the company is leaving the competition in the dust in terms of sales and profits, not to mention speed of inventory management and turnover. Wal-Mart you might think? Dell possibly? Although these two retail giants definitely fit the description, we're talking here about Zara, the flagship specialty chain of Spain-based clothing conglomerate, Inditex. This dynamic retailer is known for selling stylish designs that ' resemble those of big-name fashion houses, but at moderate prices. "We sell the latest trends at low prices, but our clients value our design, quality, and constant innovation," a company spokesman said. "That gives us the advantage even in highly competitive, developed markets, including Britain." More interesting is the way that Zara achieves its mission. FAST-FASHION—THE NEWEST WAVE A handful of European specialty clothing retailers are taking the fashion world by storm with a business model that has come to be known as "fast-fashion." In short, these companies can recognize and respond to fashion trends very quickly, create products that mirror the trends, and get those products onto shelves much faster and more frequently than the industry norm. Fast-fashion retailers include Sweden's Hennes & Mauritz (H&M), Britain's Top Shop, Spain's Mango, and the Netherland's...
Words: 2033 - Pages: 9
...Note: Solve any 4 Case Study’s CASE: I Managing the Guinness brand in the face of consumers’ changing tastes 1997 saw the US$19 billion merger of Guinness and GrandMet to form Diageo, the world’s largest drinks company. Guinness was the group’s top-selling beverage after Smirnoff vodka, and the group’s third most profitable brand, with an estimated global value of US$1.2 billion. More than 10 million glasses of the popular stout were sold every day, predominantly in Guinness’s top markets: respectively, the UK, Ireland, Nigeria, the USA and Cameroon. However, the famous dark stout with the white, creamy head was causing some strategic concerns for Diageo. In 1999, for the first time in the 241-year of Guinness, sales fell. In early 2002 Diageo CEO Paul Walsh announced to the group’s concerned shareholders that global volume growth of Guinness was down 4 per cent in the last six months of 2001 and, more alarmingly, sales were also down 4 per cent in its home market, Ireland. How should Diageo address falling sales in the centuries-old brand shrouded in Irish mystique and tradition? The changing face of the Irish beer market The Irish were very fond of beer and even fonder of Guinness. With close to 200 litres per capita drunk each year—the equivalent of one pint per person per day—Ireland ranked top in worldwide per capita beer consumption, ahead of the Czech Republic and Germany. Beer accounted for two-thirds of all alcohol bought in Ireland in 2001. Stout led the...
Words: 10226 - Pages: 41
...ZARA: Fast Fashion A Written Analysis of the Case Presented to the Faculty of School of Business and Governance Ateneo de Davao University E. Jacinto Street,8000, Davao City In Partial Fulfillment of the Requirements for the Subject MGT 428: Production and Operations Management GODOY, EARL JOY A. SUARIO, LEI ANGELA D. TACADAO, VANESSA CAREM C. TAR, KESSIA CAROL D. TOREFIEL, CHRISTINE G. December 11, 2014 I. Executive Summary This paper presents the case analysis of Zara, the largest and most internationalized of Indetex’s chains. In 2001, it operated for more than 507 stores in countries around the world, including Spain. It is a Spanish clothing and accessories retailer based in Galicia, Spain; which is founded by Amancio Ortega and Rosalia Mera. The advantage of Zara is that in just a span of three weeks, it can have a new product on its shelves ready for their consumer to purchase compared to their competitors that required from three to, even, six months. Also, the first store opened in La Coruña proved to be a success, and Ortega saw the opportunity to expand to other cities around Spain and even cities around the world. Due to rapid expansion of Zara, they suffer loss which is supposedly evitable. Zara does not take into account the product demanded in a certain country. Zara should focused on careful interpretation of the demand in a certain country for them to know whether to expand or not...
Words: 1871 - Pages: 8
...therefore inspired less trust and confidence. There was no attempt to make them anything more than just a ‘value pay’ and retailers evolved these products often referred to as private label. These are terms consumer use interchangeably, but the market has actually changed quite considerably. Retailers continued to push more and more private label products into different categories of the marketplace because they represented high margins and the promise of profitability with little to no marketing effort . The first value brand was Tescos Value range, launched in 1995; today, it includes over 2,000 products in food and non-food categories (Collins & Bone, 2008). Other retailers quickly followed suit creating their own value lines. In India private label penetration began in the mid-2000s when retailers established organized retail format stores across the country. - Organized retail occupies a small percentage of the overall retail market in India. Traditional forms of retail, such as neighborhood 'kirana' stores, dominate the market. - The most widely used private label products were cereals, pulses and spices. This was followed by packaged food products and fruits and vegetables.- In 2011, Spencer's Retail revamped its business strategy to focus on the young, urban population. In these terms they are repositioning themselves as an affordable, luxury retailer. - The...
Words: 3125 - Pages: 13
...global retailer and wholesaler of fashion clothing and accessories. Founded in 1972 by Chief Executive Stephen Marks it is based in London and its parent company, French Connection Group plc, is listed on the London Stock Exchange.[2] French Connection French Connection distributes its clothing and accessories through its own stores in the UK, US and Canada and through franchise and wholesale arrangements globally. The company is famous for the use of the "fcuk" acronym in its advertising campaigns in the early 2000s which successfully raised its profile. Contents * 1 Distribution * 2 Controversial branding * 2.1 French Connection (FCUK) * 3 Products * 3.1 Fragrances for Her * 3.2 Fragrances for Him * 3.3 Unisex Fragrances * 4 References * 5 External links Distribution French Connection distributes its branded ladies and it is a subsidiary of Calvin Klein(CK) wear and menswear through a network of owned stores in the UK, US and Canada, through franchised stores in major markets around the world (Australia, Hong Kong, China, India), through concessions in department stores in the UK and also sells its products to other multi-brand retailers. The product assortment competes in the low to mid range of fashion and price. French Connection also has a variety of licensed products,[3] including eye glasses, sunglasses, toiletries, shoes, jewellery and watches, which are sold through their own stores and specialist retailers (e.g...
Words: 1340 - Pages: 6
...4Ps ◆ Product Zara sells women, men, and kids’ apparels and other accessories, shoes, and bags. It has a strong product strategy called WIGIG “When it’s gone, it’s gone”. It means Zara produces small quantity but with varies style of garments in order to limit the supply which could push the customers snapping up queues when they see the products. Zara tend to design fashionable products according to the current trends. Also, Zara create around 40,000 new garments every year, from which 10,000 are chosen for production (Fredows, K., Lewis, M., Machuca, J., 2005). Compare to Zara, TK Maxx also has a greater range of products which including Men's and Women's clothing, shoes, accessories and handbags. It provides the unique and individual clothing and home wears with limited numbers of products as well. Moreover, the products of TK Maxx have varied in quality and designer reputation. According to TK Maxx website(2013), the buyers in TK Maxx scour the globe 24/7 to bring back the best brands at a fraction of the price. ◆ Price Generally, in order to get the most common average income customers able to purchase the products, Zara set the goal to make the price being available. Zara creates deals by providing small quantity of apparels from the same collection as amount for lower price. Randomly offer discount sale for some basic products. On the other hands, TK Maxx always provides low cost between 20% - 60% recommended retail price. Offer the prices of products for...
Words: 930 - Pages: 4
...Case study Zara 1. 1. ZARA is a Spanish clothing and accessories retailer based in Arteixo, Galicia. Founded in 24 May ,1975 by Amancio Ortega and Rosalía Mera. Zara needs just two weeks to develop a new product and get it to stores, compared to the six-month industry average, and launches around 10,000 new designs each year. Zara was described by Louis Vuitton Fashion Director Daniel Piette as "possibly the most innovative and devastating retailer in the world. 1763 stores , 78 countries worldwide. Zara has continually maintain its mission to provide fast and affordable fashionable items . Inditex (Industria de Diseño Textil) of Spain, the owner of Zara and five other apparel retailing chains, continued a trajectory of rapid, profitable growth by posting net income of €€ 340 million on revenues of €€ 3,250 million in its fiscal year 2001. Zara welcomes shoppers in 86 countries to its network of 1.763 stores in upscale locations in the world's largest cities. Zara's approach to design is closely linked to their customers. 2. 2. Around the world Zara 1.763 Zara Kids 171 Pull & Bear 817 Massimo Dutti 630 Bershka 899 Stradivarius 794 Oysho 529 Zara Home 364 Uterqüe 91 TOTAL 6.058 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. By the end...
Words: 1804 - Pages: 8
