Zara; S Fashion

BUS478

ZARA Synopsis

Xue (Grace) Wang Tianhua (Vonnie) Tan Hsu-Fan (Kelly) Kao Yiting (Vicky) Tao Fangmin (Fay) Shen

ZARA’S HISTORY

Zara is one of the most well-known international fast-fashion companies, owned by the Spanish fashion group Inditex (Zara, 2012). The first Zara store was opened in La Coruña by Amancio Ortega Gaona in 1975. From that moment forward, Zara’s expansion has been unstoppable. By the year 1990, Zara had opened stores in Oporto, Portugal, New York, USA, and Paris, France (Inditex, 2012). Utilizing Zara’s strong brand image, Zara Home was introduced in 2003, providing housewares. Later, in 2007, the first online store was launched to sell Zara Home products (Inditex, 2012). After 38 years of operation, Zara now has 1,830 stores in 82 countries across Europe, America, Africa, and Asia. The number of stores that Zara has only accounts for approximately one-third of stores that Inditex has; however, they generate more than 64% of Inditex’s sales (Inditex, 2011). Zara classifies itself through its commitment as a fast fashion brand rather than high fashion, and quickly adopts high fashion styles from the catwalk to reach the public at an affordable price. Unlike other fashion brands, which outsource their production, Zara has successfully developed a vertical integration model including design, just-in-time production, marketing, and sales (The Economist, 2001). With vertical integration, Zara is able to meet consumer demands within a relatively short timeframe and respond to market trends quickly. Because the fast fashion industry is constantly changing and hard to predict, the flexibility and efficiency provided by this model is becoming the key factor in Zara’s success.

EXTERNAL ENVIRONMENT

The fast fashion trend in the apparel industry has been revolutionized in recent decades by companies such as Zara, H&M and Topshop (London Business School, 2008). Accordingly, factors influencing the apparel industry at large will also influence the...