• Submitted by:- Ilham EL MHADDER- Seth Fearon- Quanpu Li - Saumen Adhikary

ZARA background• Was founded by Amancio Ortega

In 1975• First store opened in La Coruna,

Spain in 1985• Inditex was formed as a holding

company which ZARA is its largest chain of retail stores.

• The first store outside Spain was opened in 1988 in Portugal.

• By the end of 1990, Zara had operations in 82 cities over Spain and 3 others internationally.

Industry overview

• The global apparel market is :- consumer-driven industry. - globalization- new technologies., - changing behaviour- competition

• Clothing industry satisfies the need to : Keep warmth Display personality Satisfy the dressing code of certain occasions

Consumer analysis

• Definition Branded stylish clothes targeted for young

consumers (15-35) with medium to low budget.• Customer Profiles

- up to date , fashionable, trendy and unique - affordable prices. - man, woman, teenager and children.- influenced and moved by European fashion. - belong to any social strata and demographic segment

Competitor analysis

Zara’s 4 key competitive advantages:Short lead timeHigh turnover rateMany designsFrequent visits

SWOT analysis

• Competitive market place, same target market as Zara

• Other stores copy Zara ideas

• The increase of its own labor costs

• Worldwide known: Expand to new different countries

• Fast growing demand especially Asia.

•

• Up to date designs at attractive prices.

• Fast, inspired and responsive design teams

• Quick supply chain

strengths

opportunities

weaknessesthreats

SOCIALTECHNOLOGICAL

ENVIROMENTALLEGAL

i. New textile policy

ii. Stable communist country

i.GNP per capita $5890

ii. GDP growth of 10.7%

i. New middle class with growing purchase powerii. Cultural shift in urban areas

i. China is a known IT base country

ii. Financial benefit to zara due to online shopping.

Free access to natural resources for textile clothing.

ZARA

i.Labour lawsii. Quality control ailure by

POLITICAL ECONOMIC

Value chain analysis

Firm infrastructurefactory is located in La coruna, Spain which has:• the cheapest labor in the country. • flexibility to push new design to

the final selling point fast.

Human resources managementZARA recruits school leavers or fresh

undergraduates fresh, energetic individuals free from family

commitments

technologyZARA has invested heavily on IT platforms. As it doesn’t design on its own every time.

procurementSuppliers have agreed to supply material within 5 days to ZARA's

facility in Spain,they are using mainly tracks

Inbound logistics Zara receive the articles from its own factories (60%) or from outside suppliers twice a week.

OperationsAtomized process to create quickly. Digital interconnective work

Outbound logisticsCloths moves through Zara's distribution center to reach stores within 48 hours

Marketing and sales

Zara does almost no advertising, as it’s stores looks every week new.

servicesStores teams are interconnectivity integer in finding what customers are looking for and satisfying their tastes.

Porter 5 forces analysis• Zara uniqueness ‘trendy product at hard to beat price’ allow it to profit from

the customers purchase power easily.Rivalry

• the global fast fashion industry need a huge initial investment, a rich record of information about customers and an ability to design fast new product to get in.Threat of entry

• customers preference for the low cost trendy products are likely to switch if there desires are not satisfied. Zara is distinct from the others by the constant innovative and creative designs,

Threat of substitutes

• Customers can be flexible in choosing products across brands, but Zara constant infusion of new products, buyers are more likely to be down to its stores.

Power of buyers

• Zara make 50% of the fabric in its plant, it is less dependent on suppliers and can respond more quickly to the changes. Moreover, raw material and sufficient and widely offered. Power of suppliers

ZARA across the word

ZARA in China

• Inditex has strong potential to continue growing in a profitable way over the coming years and, in this regard, our priority is to focus on expansion in Europe and Asia.

2009 Inditex Annual Report

Time Store(s ) in China

Feb 2006 1

Feb 2007 13

Jan 2009 23

End of 2009 44

End of 2010 65

With 2013 140

First store opened in Shanghai

Grand opening day equal to800 000 RMB

Objective:contribute to the sustainable development of society and that of the environment with which Zara interacts

Differentiation

• Approval of designs: the Chinese taste need to be analyzed.

• Scarcity: gain a different segment of customers that enjoy e-commercial prices.

• Manufacturing: production depending of the region tendency.

• stores arrivals: different items in different stores will raise the stores frequentation, surprise fact

Curve value

- Publicity- E- commerce

- Price attractiveness / customers satisfactory- Innovate on males and children articles

- Make extra sizes for skinny and full body shapes- Attract a new segments:, ex “curvy” and “skinny”

- Channels of distribution in each continent

- Reduce the number made of each articles

- The one special cut for the perfect shape and consider every body shape

raise

create

reduce

eliminate