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Zara Industries Case Analysis Assignment - Essay Example

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Why do customers buy clothing from Zara? Be sure to discuss style, price, quality and the retail store experience. According to the 10Best Website, Zara has become the successful clothing retailer that it is today because it is able to mimic fashionable runway looks at affordable prices. …
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Zara Industries Case Analysis Assignment

Download file to see previous pages... Ferdows, Lewis, and Machuca suggest customers purchase clothing from Zara as a response to the unique retail store experience. The fashions are presented in a spacious store, averaging approximately 1,000 square meters, but in limited supply. For example, they may display just one of each size of a given style of pants, so the customer feels as though they must buy the clothing or miss out on the opportunity (Ferdows, Lewis, and Machuca). 2. How does the design function at Inditex differ from similar design shops at H&M and GAP? Explanation Zara has its supply chain completely under control. The company is able to have its inexpensive, fashionable clothing styles from the designer to the retail location in about two weeks (Capell). It typically takes GAP 9 months for clothing styles to make it from design to retail. H&M on the other hand takes approximately 20 days to get its designs into its stores; because like Zara, its costs are under control and the supply chain is very tight (Larenaudie). Impact on Costs and Profit Approximately 70% of the compensation paid to sales managers working in the Zara retail locations is based on commission. This is an incentive for them to accurately identify trends on a daily basis to inform the 300 designers what is hot at the moment, and what is not selling very well (Capell). ...Download file to see next pagesRead More
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