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Zara: IT for Fast Fashion - Essay Example

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This essay "Zara: IT for Fast Fashion" discusses Zara that has established itself as one of the favorite brands for, especially fashion-loving customers. Thus far, the company’s strategies have been able to successfully render it competitive advantages with a strong brand identity…
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?Case Study Assignment (Zara Case) Executive Summary Zara is one of the leading apparel and fashion brands, which operates under the flagship of Inditiex Group of Spain. The company has its operations spread in Europe, Asia, North America and Middle East. Zara is known for offering quality apparels at affordable prices. Over the years, the company has attained significant growth. Its strategies have enabled the company to gain substantial competitive advantages over its competitors. Nonetheless, the company is significantly influenced by few prominent external factors as well as few internal factors. Moreover, the wider scope in the fashion industry has provided the company with certain significant opportunities. On the other hand, it has been ascertained that value chain system of the company has been one crucial factor contributing towards its success and growth. Moreover, in the recent times, the company has also been impacted by few challenges of Corporate Social Responsibility (CSR) which has forced the company to undertake a few vital changes in over strategic implementation. Thus, the paper emphasized on identifying the factors that have influenced the strategies of the company as well as this paper comprises vital suggestions for its strategic improvement. From the findings of the study, it has been ascertained that the company has determined to achieve significant milestones. In this course, it has made certain vital plans and has further formulated strategies to successfully accomplish the benefits. Contextually, the company has significantly involved in strengthening its brand image through its involvement in the CSR activities and other promotional activities. Finally, it was concluded that the company should take certain vital precautions while implementing strategies for accomplishing the potential opportunities. It was suggested that company should not implement its strategies at single point of time rather it should priorities them according to its needs and market demands for reaping the best possible benefits in the current and future context. Table of Contents Executive Summary 2 Zara is one of the leading apparel and fashion brands, which operates under the flagship of Inditiex Group of Spain. The company has its operations spread in Europe, Asia, North America and Middle East. Zara is known for offering quality apparels at affordable prices. Over the years, the company has attained significant growth. Its strategies have enabled the company to gain substantial competitive advantages over its competitors. Nonetheless, the company is significantly influenced by few prominent external factors as well as few internal factors. Moreover, the wider scope in the fashion industry has provided the company with certain significant opportunities. On the other hand, it has been ascertained that value chain system of the company has been one crucial factor contributing towards its success and growth. Moreover, in the recent times, the company has also been impacted by few challenges of Corporate Social Responsibility (CSR) which has forced the company to undertake a few vital changes in over strategic implementation. Thus, the paper emphasized on identifying the factors that have influenced the strategies of the company as well as this paper comprises vital suggestions for its strategic improvement. 2 Table of Contents 3 1. Introduction 5 2. External Environment 5 2.1 PESTEL Analysis 5 2.1.1 Political Factors 5 2.1.2 Economic Factors 6 2.1.3 Social Factors 6 2.1.4 Technological Factors 7 2.1.5 Environmental Factors 7 2.1.6 Legal Factors 7 2.2 Five Forces Analysis 8 2.2.1 Threat of Substitutes 8 2.2.2 Threat of New Entry 8 2.2.3 Bargaining Power of Buyers 9 2.2.4 Bargaining Power of Suppliers 9 2.2.5 Competitive Rivalry 9 3. Internal Environment 9 3.1 SWOT Analysis 10 3.1.1 Strengths 10 3.1.2 Weaknesses 10 3.1.3 Opportunities 11 3.1.4 Threats 11 3.2 Resource Based View of the Company 11 3.3. Value Chain Analysis 12 3.3.1 Primary Activities 12 3.3.2 Secondary Activities 14 4. Corporate Social Responsibility 15 4.1 Ethics 15 4.2 Public Relation (PR) Crisis 16 4.3 External Stakeholders Issue 17 5. Strategic Options and Choices 17 6. Implementation 19 7. Evaluation 20 8. Recommendations 20 8. Conclusion 21 9. References 23 10. Appendix 27 1. Introduction Zara is one of the pioneering fashion brands owned by Inditex Group of Spain. It is firmly related with designing, manufacturing and distribution of apparels in Europe, the United States and Asia. The company operates its business from several outlets located in these regions. The company is primarily known for its ability to adopt new trends and for quick distribution. Over the years, the company has formulated and implemented strategies that have widely been able to satisfy the needs of its discriminating customer (Cuc & Tripa, 2007). Additionally, the company considers the environmental issues to be an important factor for formulating its strategies in order to attain progressive growth in the current as well as in the future context. This paper thus primarily deals with the preparation of strategic report for the Chief Executive Officer (CEO). 2. External Environment Zara is being able to perform proactively in all its operational locations. However, the company is significantly affected by the challenges arising from external environmental factors. Thus, this section will deal with working environment and competitive factors influencing its overall operations. 2.1 PESTEL Analysis 2.1.1 Political Factors Government and political parties in a country have significant influences on the companies operating within the country. Generally, government and political parties are liable for the creation of political benefits as well as obstructions. Since Zara operates in different countries across the globe, the varying government policies across these counties have resulted in creating the requirement for Zara to formulate its business strategies and policies according to the prevailing government policies (Kraemer & Tulder, 2009). 2.1.2 Economic Factors In the recent years, the global economic environment has been suffering from a few unfavourable economic conditions. Consequently, Zara has also not been separated from this economic turmoil. These changing economic conditions have dramatically resulted in reducing the disposable income held by the customers forcing unfavourable variations on the customers’ spending abilities. In order to effectively tackle these issues, Zara has been constantly involved in framing strategies for attracting more and more customers towards the company’s stores (Kraemer & Tulder, 2009). 2.1.3 Social Factors Social environmental factor is another important issue that has the tendency to influence the overall performance of the companies operating in different countries with varying culture and lifestyle patterns. Nonetheless, Zara enjoys substantial benefits of strong brand image which has facilitated the company to draw large customer groups who usually prefer to associate themselves with branded products and services. Notably, the company along with the production of branded products also offers its products and services at much lower prices than its competitors, which has facilitated to attract customers who are price sensitive and also willing to purchase good quality apparels (Luo, 2008). 2.1.4 Technological Factors Technological factor is an important determinant for the success of any business in the current business context. Traditionally, technological factors were firmly related with those enterprises dealing with technological equipment only. Nonetheless, technological factor also plays a crucial role in the fashion and apparel industry. Contextually, the increasing competition in the industry has forced Zara to undertake extensive technology improvement programmes in order to enhance its supply chain and attain considerable competitive advantages (Luo, 2008). 2.1.5 Environmental Factors The recent business houses are now prudent about the impact posed by the environmental factors. Usually, the environmental factors influencing the fashion and apparel industry is concerned with the consumption of energy and the use of toxic chemicals. At the same time, the volume of waste materials coming from fashion and apparel industry has also increased over the last few years. Contextually, Zara in the recent past has determined to convert itself into an eco-friendly company (Environmental Leader LLC, 2012). 2.1.6 Legal Factors Legal factors most probably have radical impacts on the functioning of the companies operating internationally. As a consequence of the changing economic conditions across the world, the governments of different countries have altered their taxation policies, interest rates and their strategies towards inflation. Additionally, the fashion industry has been firmly challenged with the growing influence of copyrights and other intellectual property. Undoubtedly, the increasing trends related with copyright and intellectual property has limited the functioning of fast developing fashion and apparel companies such as Zara (Lopez & Fan, 2009). 2.2 Five Forces Analysis Fashion and apparel industry has become more competitive due to the increasing competition as well as owing to the greater internationalisation of the business (Morden, 2012). Zara, due to its rapidly increasing global business activities, is significantly posed with intensified competition arising from both international firms and local firms. 2.2.1 Threat of Substitutes The threat of substitutes is usually high for Zara and other companies operating in the fashion and apparel industry. These threats are significantly emanated from competitors in the industry, tailor houses and designer retailers. The substitution of generic products is usually developed by offering these products at relatively low prices to the customers (Dutta, 2002). 2.2.2 Threat of New Entry The fashion and apparel industry has relatively low entry barriers. It is owing to the fact that entry for new firms does not require much cost. Nonetheless, the aspects of product differentiation and brand identity have the most significant impacts on the entry of new firms (Ghodeswar, 2008). Thus, the strong brand identification of Zara facilitates in providing competitive advantages in the industry which also deters new firms to enter into the industry (Dutta, 2002). 2.2.3 Bargaining Power of Buyers Buyers in the fashion and apparel industry have relatively higher bargaining power than it was before. The present buyers generally possess more discriminating demands for high quality products as well as they are significantly influenced by the frequent changes in the prevailing trends. Moreover, buyers in the current context have developed choices for products with specific colours and sizes. In order to reduce the buyers’ switching costs, the company has been determined to offer the most fashionable products for meeting the needs of its target market at most appropriate price (Dutta, 2002). 2.2.4 Bargaining Power of Suppliers The bargaining power of suppliers is quite low in the fashion and apparel industry. This is because the companies in this industry usually outsource the production in developing countries. Nonetheless, Zara has relatively high bargaining power due to its vertical integration business model (Gallaugher, 2008). 2.2.5 Competitive Rivalry Owing to the relatively low entry barriers in the industry and global operations of Zara, it is encountered high competitions arising from other international firms as well as local competitors (Gallaugher, 2008). 3. Internal Environment Zara’s internal business environment has substantially vital impact on it overall operations. The strategies formulated by Zara have added towards increasing its capabilities to meet the customers’ needs and expectations efficiently (Hill & Westbrook, 1997) In order to assess the significance and drawbacks of Zara’s internal environment SWOT analysis is being undertaken below: 3.1 SWOT Analysis 3.1.1 Strengths Many factors contribute towards the strengths of Zara. The most important factor that has the significant influence on the sales of the company’s product is its strong brand identification in all the countries of its operations. Additionally, the company does not outsource all the production activities in developing countries. Instead, the company acquires its production from its home country Spain where there is comparatively low labour costs than other European countries (Gallaugher, 2008). This facilitates the company to reduce the costs associated with shipping and to meet the demands of its customers more quickly than its competitors who have outsourced their production capabilities to developing countries only. Therefore, it facilitates Zara to attain greater competitive benefits over its rivals. The company also emphasises on group design rather the individual design which enables it to offer most attractive products to its customers. Additionally, the technology based systems implemented by the company immensely support its internal logistics as well as the online selling activities have benefited the company to boost its annual sales turnover (Lopez & Fan, 2009). 3.1.2 Weaknesses One of the major factors that can be related with the weaknesses of Zara is the failure of the company to communicate its products to customers. Generally, the company spends relatively low on the promotion of products and services which deters it to accomplish its goal of attaining maximum sales (Lynn & et. al., 2009). 3.1.3 Opportunities The primary opportunity associated with Zara is that the fashion and apparel industry is rapidly flourishing across the world which provides the company with ample scope for expanding its business to developing countries of the world. Additionally, customers are now more inclined towards using branded products at relatively low prices, which facilitates Zara to increase its customer base (Grail Research, 2009). 3.1.4 Threats The substantial threats faced by Zara are derived from the increasing local and global competition. Additionally, the rising production costs and increasing wage rate are other major factors contributing towards the threats for the company. At the same time, the frequent economic instability has also been a matter of concern for the company to sustain its business profitably (Lopez & Fan, 2009). 3.2 Resource Based View of the Company Resource based view of the company usually deals with attaining competitive advantages depending on the relationship with internal capabilities of the company and external circumstances. Moreover, the notion of cost leadership has been identified as an important factor for attaining competitive advantages. Since it has been identified that Zara offers its fashion products at relatively low cost, it can be ascertained that Zara positions itself as a low cost firm wherein the company intends to attain competitive advantages by offering its products at reasonably low price to its discriminating customers. It has also been identified that the capabilities of the company should coincide with the resources that shall facilitate it to attain greater competitive advantages. With this consideration, it can be affirmed that Zara spends considerable time on designing and manufacturing of its products through its team of experts which facilitates the company to differentiate its products from its competitors’ products enabling the company to take the advantages of first mover in the market and thereby resulting in gaining adequate competitive advantages (Hart, 1995). 3.3. Value Chain Analysis Zara has one of the unique supply chains that facilitates in providing the company with significant competitive advantages. The company has been endeavouring towards attaining efficient value chain at relatively lower costs in the current global business context. The company’s primary objective in attaining the most efficient supply chain is to duly meet the needs of its end customers by manufacturing and distributing products timely and in a cost effective manner (Haberberg & Rieple, 2008). This section deals with value chain analysis of Zara which is based according to the Porter’s value chain model. The varied pertinent activities performed by the company are divided into primary and secondary activities. 3.3.1 Primary Activities Inbound Logistics Inbound logistics usually comprise activities that deal with receiving, storage, and disseminating of inputs. Zara purchases the raw materials required for the manufacturing of its products from multiple countries. Inditex under which Zara operates has over 200 external suppliers. Zara not only has external suppliers but the company also undertakes extensive in-house manufacturing activities (Bhagwat, 2011). Operations Zara has adopted flexible manufacturing procedures in order to ensure rapid manufacturing and production process. Owing to the relatively high cost of labour, the company largely concentrates on ensuring higher productivity and effectiveness of its production process (Bhagwat, 2011). Outbound Logistics Zara has its specific integrated distribution arrangements. The company makes shipments from its warehouse to different stores through the third party delivery system. The shipment in primarily made through trucks (Bhagwat, 2011). Marketing and Sales Zara manufactures products for all age groups including men, women and children. Nonetheless, the company does not rely more on the promotional activities for marketing and sales of its products. It intends to offer a wide range of designer products and other accessories such as shoes, bags and jewellery at the most appropriate costs through its sophisticated stores. Additionally, the company has established its stores typically at visible locations, which facilitates in familiarising the company and its products to its customers. Moreover, most of the stores are owned by Zara while others are leased by the company. The company’s policies concerning store operations have substantially aided it to reinforce its marketing strategies (Bhagwat, 2011). 3.3.2 Secondary Activities Infrastructure The operations of Zara are primarily centralised as opposed to its major competitors. Contrarily to a few of its competitors’ factories which are located in developing countries like India and China, Zara’s factories are usually located in its home country Spain (Gallaugher, 2008). Nonetheless, these locations fall under the category of low labour costs within the country but comparatively not when equated with Asian countries like Bangladesh, India and China (Gallaugher, 2008). Human Resource Management Zara has been constantly involved in seeking skilled employees within the company. The human resource management within the company ensures that fast and reliable decisions are made within the shortest probable time. Furthermore, the company makes sure that competent employees are retained at both headquarters as well as in its stores (Ton & et. al., 2010). Technology Development Zara has adopted vertically integrated business system for ensuring greater speed in the production and distribution of finished products (Hughes, 2013). The company had made substantial investments on acquiring new technologies for removing the bottlenecks of communication as well as for attaining the objective of eco-friendly business (Unique Business Strategies, n.d.). Procurement As stated earlier, Zara usually sources inputs in the form of fabrics and finished garments from external suppliers. Accordingly, it was ascertained that company sources nearly 40% of its finished garment internally while rest of the garments and other inputs are sourced from continents of Europe, North America and Asia (Unique Business Strategies, n.d.). 4. Corporate Social Responsibility Corporate Social Responsibility (CSR) has emerged as one of the widely discussed topics in the recent business context (McWilliams & et. al., 2006). It has been argued that efficient CSR activities often act as one of the key success factors for an organisation (Nordberg, 2011). 4.1 Ethics The commitment of Zara towards the geographic locations of its operations can be usually seen in its daily functioning wherein its CSR teams are constantly involved in the improvement of social as well as working conditions. Notably, Zara has both in-house and external CSR teams which comprise over 200 people working across the world. Inditex has set code of conduct in all its sub-units including its largest sub-unit Zara (Joy & et. al., 2012). The company ensures that these conducts are duly followed by every individual associated with the company. The strategies of Zara have always been towards the creation of significant value for its wide customer base. The company further ensures that any sort of actions that lead towards the non-compliance of this code of conduct is liable for implementation of short-term corrective action plans (Inditex, 2011). The set of code of conducts adhered to by the company ensures that the ten basic points are duly abided by its suppliers for ensuring that the company’s commitment towards CSR activities are duly fulfilled. These ten basic points are being presented below: 1. Forced labour. 2. Child labour. 3. Discrimination. 4. Freedom of association along with collective bargaining. 5. Abuse or inhuman treatment. 6. Security and hygiene. 7. Payment of salary. 8. Working hours. 9. Environmental commitment. 10. Regular work. Source: (Corporate Excellence, 2011) 4.2 Public Relation (PR) Crisis Zara has, over the years, encountered PR crisis at several occasions which has negatively influenced the brand and its reputation in the global business context. During 2011, Zara was caught in a slave labour scandal in Brazil. Unfortunately, this case was made public in a show named "The League" which claimed that the company had purchased products which were produced in illegal working conditions by Bolivian and Peruvian immigrants. However, the company denied in terms of taking such responsibility. Similarly, during the year 2008, Zara was held responsible against the charges of abuse to workers in Bangladesh. Additionally, the workers were forced to work in unfavourable conditions where women were suffering from verbal and physical abuse (BBC, 2013). Moreover, environmental organisation, Greenpeace has identified toxic chemicals in 89 items out of 114 items of Zara. Accordingly, the organisation revealed that Zara produces the most toxic substances that have significant impacts on the human beings as well as on environment (Environmental Leader LLC, 2012). 4.3 External Stakeholders Issue External stakeholders of the company usually comprise customers, suppliers and creditors. The external stakeholders are thus the most important aspects related with the success of the company (Simmons & Lovegrove, 2008). In the recent times, Zara has encountered numerous problems related with its external stakeholders primarily with its suppliers that have some vicious impacts on its overall performance as well as on its brand equity. As stated earlier, Zara’ suppliers were found to be associated with slave labour in Brazil where they were alleged against child labour (Osborne, 2013). Responsively, the company had termed such act to be against the code of conduct set by it. Additionally, such act has resulted in weakening the company’s ties with its suppliers. Moreover, the involvement of suppliers in such illegal tasks has significantly hampered the reputation and brand equity of the company (Antunes, 2011). Furthermore, an investigation conducted by Greenpeace also revealed the use of hazardous chemicals in the garments products manufactured by Zara which has also hampered the company’s brand identification as well as its overall reputation. Owing to the potential impact of such activities on customers and other external stakeholders as well as the criticism by Greenpeace, the company has decided to go for toxic-free operations (Environmental Leader LLC, 2012). 5. Strategic Options and Choices The manufacturing process in Zara is usually centralised to its home country Spain. Although, Zara purchases raw materials required for its operations from different countries located in Europe, North America and Asia, the major assembly of the various components are performed in Spain and thereby the company firmly denies the notion of cheap outsourcing (Gallaugher, 2008). This strategy adopted by the company can be considered as to be one of the positive approaches wherein owned working groups are benefited as well as such approach also curtails any possibility of the company which might result in the emergence of unethical issues. Moreover, the organisation has been able to create a strong quality management process within the industry that has led towards increasing competitiveness of the company. However, it is firmly suggested that the company should also vividly undertake outsourcing from other countries wherein the costs of raw materials and labour costs are relatively low. Such decision to outsourcing shall enable the company to achieve economies of scale. At the same time, it is important to consider that outsourcing may also raise certain issues related with quality factor of the products’ outsourced as well as such factor may also lead towards the emergence of issues like employee relationship management. Despite such factors, the company should significantly devote towards internationalisation of its business. Notably, its expansion policy should not remain confined to the developed countries only instead the company’s strategies should also focus on meeting the needs of emerging markets of Asia and Latin America. Another option which has been undertaken by the company in the recent past years has been its attempts towards transforming its business to eco-friendly ways and developing more sales point. Since the criticism made by Greenpeace, Zara has been striving to go toxic-free in terms of its business operations. The management of the company has articulated its firm determination of going for toxic-free operations as one of the primary missions of the company. Additionally, it is expected that such endeavour of the company shall benefit it with enhancing competitive advantages. Notably, competitors have also shown their firm determination towards such task, thus the company is required to make reliable plans in order to achieve better outcomes than its competitors consequently attaining substantial competitive advantages. Zara has been able to successfully implement the notion of fast fashion in the industry. The company constantly makes the evaluation of the market trends and frequently introduces new styles of apparels in the market. It involves team of designers who transform their group ideas into designing attractive apparels at less time period than its competitors which facilitates the company to create greater demand for its products and to attain vital competitive advantages over its competitors. The primary purpose behind the constant initiatives undertaken by its team has been to understand the needs of its discriminating customers by moving parallel to the demands of its customer. Additionally, effective market research and customer need identification provide the company with an option to determine new business dimensions. The factor of brand over the years has emerged as one of the pivotal components for ensuring the effectiveness of the company at the marketplace. Thus, it further strengthens Zara’s brand identity in existing markets and in potential markets as well which provides another significant option for the company to achieve better response from the market. The strong brand identity shall serve as a differentiating factor for the company’s products from its competitors’ products at the marketplace. Such initiative of the company shall contribute towards attaining greater customer loyalty followed by increasing sales. 6. Implementation The opportunities and options identified above are however not easy to achieve. In order successfully accomplish and achieve the desired outcomes from the above stated options, the company shall have to be determined and undertake effective planning continuously and prudently. Moreover, efficient leadership direction is also essential in the course of attaining the successful outcomes. In the recent times, the management of the company has implemented a few vital strategies related with potential options and opportunities. Still, the company has to go a long way regarding its international expansion policies and strategies. The company will be required to hire skilled human resources for enhancing its production and reducing cost of products while entering into new markets in order to offer products at reasonable prices and create demand for its products. The facet of inefficient workforce management may constitute towards increasing wastages of time and resources. At the same time, the company should also adopt itself to rapid technological changes for ensuring greater efficiency in its manufacturing process. Additionally, the endeavour of entering into potential markets may cause Zara to face the allied challenges related to distribution centres owing to the fact it does not have many distribution centres at international locations. Moreover, the attainment of eco-friendly mission and objectives of the company may also raise issues of quality management (Lopez & Fan, 2009). 7. Evaluation Despite the existence of certain specific challenges that might arise in the course of implementation of strategies. However, the company in the long run can generate significant benefits out of successfully overcoming these challenges. Thus, it should not underestimate these opportunities. It should duly undertake measures to reduce the negative implications that may tend to emerge during the attainment of these opportunities and options. It is estimated that strengthening brand identity shall significantly contribute towards the attainment of substantial competitive advantages and greater customer loyalty. In the similar context, the effective internalisation of the company shall render it to increase its customer base and sales turnover, meeting its primary objective of earning substantial profits (Wang & et. al., 2013). 8. Recommendations It can be recognised that comparatively Zara has been successful enough to adopt a stable business model which prominently differs from traditional strategies followed by other retailers in the past. Despite the efficiency in its business model, the company has not been able to attain much success in the global context apart from European countries, typically due to the differences in the lifestyle pattern and preferences between the European customers and the other customers in Asia and America. Thus, it is necessary for Zara to frame and to implement certain strategies that shall assist the company to perform its business effectively not only in Europe but also in other countries across the world. At the foremost, the company should undertake the expansion strategy within the Europe and leverage its production activities to other countries not limited to Spain only. Additionally, the company should also make expansion to the US and Asian market by leveraging its production and distribution activities in the countries with low labour costs. Such expansion strategies shall enable the company to take the most flourishing advantages of expansion opportunities. It has been ascertained that Zara’s competitive advantages reside in its business model. Zara may require bringing in some changes in its business model by adopting less centralised business model. It is also suggested that Zara need to be careful relating to franchising and joint-venture. At the same time, the company should pay considerable attention on Corporate Social Responsibility (CSR) activities and use its CSR strategies as one of the promotional tools for attaining greater competitive advantages and improving its public relationship. Along with the CSR activities, the company should also emphasise on advertisements and brand building activities. It is equally vital that the corporation undertakes its strategies on the basis of the market trends and segmentations. In the course of implementing these strategies, the company may get hindrances owing to certain risks that need to be crucially identified. In order to omit these risks, it is suggested that the company should consider sequential implementation of the strategies framed which would otherwise cause it to suffer from heavy capital losses. 8. Conclusion Zara has established itself as one of the favourite brands for especially fashion loving customers. Thus far, the company’s strategies have been able to successfully render it competitive advantages with strong brand identity and by offering new fashion products in keeping with the prevailing market trends. At the same time, the growing fashion industry has facilitated Zara with ample opportunities. Nonetheless, the company has significantly involved in making best possible use of these opportunities for current situation as well as for future period. Thus, it is suggested that Zara should not implement all its strategies simultaneously as it may result in poor control over its decisions. It is advisable that the company should distinguish opportunities on the priority basis and follow sequential implementation of the strategies designed to achieve the various opportunities. Zara should duly pay attention towards changing market trends before implementing any strategy. At the foremost, the company should grab the opportunities related with international expansion which will require it to improve its distribution centres and may also demand for decentralisation of its distribution centres to other countries. It is also suggested that company apart from CSR activities, it should also undertake extensive advertisement activities for strengthening its brand identity (Luo, 2008). Finally, it can be stated that the company has been moving towards the progressive direction and further it should constantly put more initiatives for strengthening its capabilities in order to seek profitable growth in the current business scenario as well as future period. 9. References Antunes, A., 2011. Zara Accused of Alleged 'Slave Labor' In Brazil. Forbes.Com LLCTM. [Online] Available at: http://www.forbes.com/sites/andersonantunes/2011/08/17/zara-accused-of-alleged-slave-labor-in-brazil/ [Accessed April 18, 2013]. BBC, 2013. Zara Forces Dhaka Factory Closure. Business. [Online] Available at: http://news.bbc.co.uk/2/hi/business/7469446.stm [Accessed April 18, 2013]. Bhagwat, S., 2011. Zara: IT for Fast Fashion Case Analysis. University of Houston-Victoria, pp. 3-19. Corporate Excellence, 2011. Zara: Managing chain of value and driving CSR with consumers. Public Affairs, pp. 1-4. Cuc, S. & Tripa, S., 2007. Strategy and Sustainable Competitive Advantage- The Case of Zara Fashion Chain. Fascicle of Management and Technological Engineering, Vol. VI, No. XVI. Dutta, D., 2002. Retail @ the speed of fashion. Case Study, pp. 1-7. Environmental Leader LLC, 2012. Zara Bows to Greenpeace Commits to Zero Chemical Discharge. Popular Topics. [Online] Available at: http://www.environmentalleader.com/2012/12/03/zara-bows-to-greenpeace-commits-to-zero-chemical-discharge/ [Accessed April 18, 2013]. Grail Research, 2009. The Global Fashion Industry – Growth in Emerging Markets. Global Fashion Industry, pp. 1-21. Ghodeswar, B. M., 2008. Building Brand Identity in Competitive Markets: A Conceptual Model. Journal of Product & Brand Management, Vol. 17, No. 1, pp. 4–12. Gallaugher, J. M., 2008. Zara Case: Fast Fashion from Savvy Systems. Introduction, pp. 1-11. Hill, T. & Westbrook, R., 1997. SWOT Analysis: It’s Time for a Product Recall. Long Range Planning, Vol. 30, No. 1, pp. 46-52. Haberberg, A. & Rieple, A., 2008. Strategic Management: Theory and Application. Oxford University Press. Hill, T. & Westbrook, R., 1997. SWOT Analysis: It’s Time for a Product Recall. Long Range Planning, Vol. 30, No. 1, pp. 46-52. Inditex, 2011. Economic, Social and Environmental Performance. Annual Report 2011, pp. 1-300. Hart, S. L., 1995. A Natural-Resource-Based View of the Firm. Academy 01Management Review, Vol. 20, No. 4, pp. 996-1014 Joy, A. & et. al., 2012. Fast Fashion, Sustainability, and the Ethical Appeal of Luxury Brands. Fashion Theory, Vol. 16, Iss. 3, pp. 273–296. Kraemer, R. & Tulder, R. V., 2009. Internationalization of TNCs from the Extractive Industries: A Literature Review. Transnational Corporations, Vol. 18, No. 1, pp. 137-156. Lynn, H & et. al., 2009. H&M vs. Zara. Comparing Marketing Strategies, pp. 1-18. Luo, D., 2008. How to Manage a Brand to Be Strong: A Study of Zara. University of Nottingham, pp. 1-78. Lopez, C. & Fan, Y., 2009. Internationalization of the Spanish Fashion Brand Zara. Journal of Fashion Marketing and Management, Vol. 13, No. 2, pp. 279-296. Morden, T., 2012. Principles of Strategic Management (Epub). Ashgate Publishing, Ltd. McWilliams, A. & et. al., 2006. Corporate Social Responsibility: Strategic Implications. Journal of Management Studies, Vol. 4, No.1, pp. 0022-2380. Nordberg, D., 2011. Corporate Governance: Principles and Issues. Sage Publications. Osborne, L., 2013. High-Street Fashion Store Zara Accused of Using Slave Labour at Factories in Argentina. News. [Online] Available at: http://www.dailymail.co.uk/news/article-2303358/High-street-fashion-store-Zara-investigation-use-slave-labour-factories-Argentina.html [Accessed April 18, 2013]. Simmons, J. & Lovegrove, I., 2008. Bridging the Conceptual Divide: Lessons from Stakeholder Analysis. Journal of Organizational Change Management, Vol. 18, No. 5, pp. 495-513. Ton, Z. & et. al., 2010. Zara: Managing Stores for Fast Fashion. Harvard Business School, pp. 1-18. Unique Business Strategies, No Date. The Story of Zara –The Speeding Bullet. The Strategist’s Choice. [Online] Available at: http://www.uniquebusinessstrategies.co.uk/pdfs/case%20studies/zarathespeedingbullet.pdf [Accessed April 18, 2013]. Wang, X. & et. al., 2013. ZARA Synopsis. Current Situation, pp. 1-10. 10. Appendix Zara’s Business Model: Source: (Corporate Excellence, 2011) SWOT Matrix: Strengths Weaknesses Globally Recognised brand Technology oriented manufacturing process Products parallel to market trends Substantial competitive advantages Centralised control Not many distribution centers Poor promotional activities Inadequate CSR activities Opportunities Threats Growing fashion industry Scope for international expansion Outsourcing in developing countries Increasing competition from national and international firms Rising cost of raw materials Increasing wage rates of labour Source: (Gallaugher, 2008) Read More
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Zara IT for Fast fashion

ZARA: it for fast fashion.... Failing to upgrade its POS terminals could potentially make the company lose its edge in terms of speed in delivery of fast fashion to its competitors, due to obsolete ancient technology.... Within the fast fashion industry, what is fashionable today may be obsolete and unfashionable tomorrow (Tesseras, 2009).... Zara's business model sells fashion more than it does apparels.... Thirdly, since the POS terminals are not connected to Zara's headquarters or stores, the sales data transmitted at the end of the day, may not fully reflect changing fashion trend sales (McFee, Dessain, and Sjoman, 2007)....
4 Pages (1000 words) Essay

ZARA It for Fast Fashion and GAP

ZARA: it for fast fashion and GAP.... Zara is in the fashion industry and it deals in men's clothing industry and women's clothing.... Zara is in the fashion industry and it deals in men's clothing industry and women's clothing.... Their products is divided into shoes, cosmetics and complements all directed towards making changes in the fashion industry and attracting more customers to purchase more of their products (Gitman & McDaniel, 2009)....
4 Pages (1000 words) Research Paper

Zara - IT for Fast Fashion

The essay "Zara - it for fast fashion" concerns Zara - fashion company.... The company survives in the competitive global fashion industry upon an analytical survey of the market variables.... The Zara fashion company defines the global market environment in accordance to the marketing variables of psychographic, demographic, behavioral, and the demographic factors.... The company preserves the strengths of analyzing the customer targets in the market as serving the entire fashion market poses more threats than opportunities....
4 Pages (1000 words) Case Study

Zara IT for Fast Fashion

The case study "Zara IT for Fast Fashion" indicates that the company relies on an outdated operating system for the store terminals and lacks readily available network across all the stores.... The essay analyzes the fast fashion of Zara.... zara stands out as the largest, most profitable and internalised chain among all others.... The case study focuses on Inditex, Spanish retail giant, and the manner in which its largest retail chain, zara, has been successful....
8 Pages (2000 words) Essay

Improvement of Zara through IT

Zara: it for fast fashion.... The essay analyzes the Improvement of zara through IT.... The first point of concern that is presented is by the reservation that zara have in the adoption of inventory management software for their specific stores.... This essay discovers zara Improvement through IT.... zara CASE STUDY by Improvement of zara throughIT ... he first point of concern that is presented is by the reservation that zara have in the adoption of inventory management software for their specific stores....
1 Pages (250 words) Essay

Information Technology Management Course

"Zara : it for fast fashion.... Zara has a Dos( Disk Operating System, Microsoft's) enabled operating system and online database system in action, with the modern and fast paced technological changes taking place in present day, the need is being felt to upgrade the network to a fresher version of online.... Zara hasa Dos( Disk Operating System, Microsoft's) enabled operating system and online database system in action, with the modern and fast paced technological changes taking place in present day, the need is being felt to upgrade the network to a fresher version of online repository....
2 Pages (500 words) Essay

How to Support Operational Effectiveness

"Zara: it for fast fashion.... This is because strategy and operational effectiveness are a duo that is both essential for the performance of zara since it will enable for constant change to.... The recommendations for zara for improved operational effectiveness are to adopt the most modern technology to be at par with its a.... Recommendations for zara to improve the way IT can be used to better support operational effectiveness....
2 Pages (500 words) Essay
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