Zara Strategy Analysis - Essay Example

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Zara Strategy Analysis
This paper seeks to analyze the Zara strategic position at the end of the Zara case study. Zara Company stands at Northern Spain in a poor, shipbuilding town of La Coruña. …
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Download file to see previous pages The chain offers a diverse clothing lines for women, men, and children, legions in latest designs. It operates through “The Cube” under the command of the giant Inditex Corporation. The corporation has been on the rise since 1996 recording massive sales ahead of its competitors like Gap. Thus, the firm became the world’s largest fashion retailer in 2008 with its eight brands. However, the corporation’s growth rate attributes to the success in Zara sales, which amounted to two-thirds of the corporation sales. Zara is venturing in fast expansions all over the world with new markets in over 68 countries in the globe. It is the most innovative and devastating fashion retailer in the world with immense profits though its products are relatively cheap. The chain relies on latest blend of technology to devise its market strategy. The chain has unleashed a strategy that shuns advertising, does not run sales, and keeps its huge investments of production at home. In a field where almost all firms outsource their manufacturing processes to low-cost countries, the Zara Company seems to negate all the fashion industry rules thus remaining vertically integrated in the market. However to analyze the success of Zara strategy in the market, we will need to consider various factors in relation to technological advancements. The analysis will consider the internal and external perspectives and use strategic models and theories in drawing a conclusive decision. The analysis will focus on critical issues that would guarantee long-term success. The analysis will also look into the sustainability of the strategy, its feasibility, and acceptability in the fashion industry. ...
marise the key findings from the analysis and make informed recommendations in an effort to maintain the growing success of the company. The paper will use the SWOT analysis to summarise the analysis and reach a defined conclusion. The paper will apply the Igor Ansoff Matrix models, seven s analysis, and pestle, in the analysis. Igor Ansoff Matrix model (Ansoff, 1988, n.p) Existing markets New Markets Existing New In using this model, I will try to show the market penetration of Zara products in the existing markets. I will also highlight the market development of Zara products in new territories in both new and existing markets. Additionally, the model will note diversification of Zara products in new markets using the existing capabilities. The model will henceforth highlight Zara product development in both new and existing markets using the existing capabilities. External analysis PESTLE (Johnson et al, 2009, n.p) PESTLE Summary Zara Company is subject to political stability and attitudes to competition. This rises from its major establishment and dominance in one country. In case of political instability and change of attitude in competition, Zara market advantage will crush. Factors of global recession and economic growth will equally affect the company since it has stores in many countries. Changes in lifestyle and social mobility will jeopardize the company sales since it concentrates mostly on two stores located in the same country. Changes in technology will significantly affect the company since its operations rely on technology and machines. Competition, employment laws and difference in laws between nations has a great significance in the mode of competition, recruitment of staff, and the running of the company in various nations it plans to invest. The ...Download file to see next pagesRead More
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