Zara: the Spanish retailer goes to the top of world fashion’ Case Study
7/31/2015 0 Comments

Introduction

Zara (Inditex) is one of the successful fast fashion retailers under Inditex Group founded in 1975 owned by Ortega a Spanish businessman who owns 1830 stores in 82 countries and it is a vertically integrated retailer, controlling most of the steps on the supply chain (designs, produces and distributes itself). Pull & Bear, Massimo Dutti, Berksha, Oysho, Zara Home, Stradivarius, Uterque are the other multi-brands which come under Inditex itself. Low inventory cost, short lead time, quick response to the market, store is the main promotional tool, quick delivery and sales has made Zara’s business model distinguish among other competitors in the fashion industry -Inditex’s multi-brand success in 2011

-Sales growth of three giants in the fashion industry (including H&M and Gap Zara’s main competitors)

Key success factors of Zara

- Short lead time

- More styles

- Pricing strategy

- Sell stocks in short term

- Broad target market through multi brand portfolio

- Quick respond to the market

1) Which theory is the best representative of Zara’s (inditex’s) internationalization?

The internationalization practice of Zara started with the opening of a store in Oporto (Portugal) in the year 1988, through this establishment Zara acquired international market experience and knowledge. When analyzing Zara’s international expansion Uppsala model could be considered as the theory behind Zara’s internationalization strategy. Zara expanded into international markets after exposing and getting the experience from the domestic markets, starting their foreign operations from culturally and geographically close