By choosing to be in the most prominent locations in a city, Zara ensures very high customer traffic for its stores. In Africa, it has stores only in Egypt, South Africa, Morocco, Tunisia and Algeria. Executive Summary This case paper presents the business analysis of Zara, the leading and the profitable brand of Inditex. Economic downturn can also be a threat to their target segment 3. Tencel, or lyocell, is a fabric made from wood cellulose sourced from certified socially and environmentally responsible forests.
Competitors offer discounts, promotions and to attract customers. These forces are important and their effect on businesses is deep. It also eliminates the need for warehouses and helps reduce the impact of demand fluctuations. However, other key competitors that operate in the fashion industry in the South African market include; Topshop, Forever 21, Mr Price, Woolworths and Cotton On Spinks, 2014; le Cordeur, 2016. The green side of business has become more important now than ever. Doesn't spend much money on advertising 3.
Every year Zara comes up with thousands of new pieces of clothing. Product Development Consumer Analysis Market Analysis 13 Ext. Apart from partnering the local brands, there remains no other way to penetrate such markets. It has to know the entire system before taking any permanent step. Jennifer Senior; she performed the breast cancer surgery for Kylie Minogue too. Weakness stands for the all the aspects which give the rival companies a competitive advantage.
The 2011 riots taught us nothing: when will the young and dispossessed kick off again? And thus it is important for the company to form a strategy that addresses these factors Louw and Venter, 2013. Its affordable pricing strategy has also enabled it to tackle the economic pressures. Even Zara would like all such consumers who are well aware of the cause of Breast Cancer to join the event and contribute towards the social cause. In comparison, traditional daily sales reports can hardly provide such a dynamic updated picture of the market. Instead of outsourcing its work to cheap labor markets of Asia, it makes the most out of the cheap labor supply of Portugal and Galicia. Macro Environment Analysis Conducting a macro environmental analysis is imperative as the macro environment in which a brand operates affects everyday business Frue, 2017. They sold out in 3 days.
The solution was as simple as it was brilliant: his idea was to shorten the period of collection development from six months to… two weeks! Stradivarius: Casual and feminine clothes for young women acquired in 1999. Вісник соціально-економічних досліджень, 3 1 , 129-134. Affordable Prices Owing to its affordable brand label, customers get to enjoy high-end fashion clothes at affordable prices. The first logistics center for Zara was built in 1984 and encompassed about 10,000 square meters. In the 21st century, technology has disrupted the market equation like never before. The creative team of Zara comprises of over 200 professionals.
Your assignment will reach your inbox. Degree of Rivalry: High The bargaining power of rivalry is high. Opportunities are the areas of potential advantage, which the company can use profitably in future in order to outpace its rivals. Its unique supply chain infrastructure and efficiency of the business operation give the company the competitive advantage, which reflects in their sales and revenues. Products are also sold online with using online channels to promote their brands.
Mr Price is a leading fashion retail company that originates from South Africa Mr Price Group, 2017. Zara only has two time bound sales a year rather than constant markdowns, and it discounts a very small proportion of its products, approximately half compared to its competitors, which is a very impressive feat. Zara used the cost-based method to value intangible assets, and therefore in order to financially value the Zara brand; this method will need to be applied Inditex, 2015. It has managed a well integrated supply chain that caters to its needs for raw materials successfully. After assessing its internal and external factors, it is noticed that Zara manages to stay up at the revenue growth due to its unique and strong model of the business. With the help of their efficient vertically integrated supply chain, they get the designs into the stores while the trends are still peaking.
Here is a comparative study conducted by newspaper El Confidential demonstrating pricing differences in various countries, 22% to 24% higher in France, Italy and Germany. Transition to next generation ownership: With various technological and business disruptions in the past decade, leadership in the 21st century will be influenced by constant change, geopolitical volatility, and economic and political uncertainty. According to him, people should love to use and wear clothes for a short while and then they should throw them away, just like yogurt, bread or fish, rather than store them in cupboards. Scores of Zara stores appeared in Spain, then Portugal and other European countries as well as overseas. It has to know the entire system before taking any permanent step. The cash is invested in new stores.
A tangible value represents the benefits that can be quantifiably measured, and therefore in order to establish a tangible value for the brand, a brand valuation should be used Merriam Webster, n. This is just a sample partial case solution. They are the third largest brand in the garment industry. It choose its locations very carefully to cater local customer by understanding their needs. In several countries it is selling online and in several more it is still to grow its online presence and sales.