Zara Strategic Analysis

Topics: Inditex, Albania, Uterqüe Pages: 7 (2108 words) Published: April 27, 2013
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1. Executive summary

Background Information
Inditex is an international Spanish company that designs, manufactures, and sells apparel, footwear, and accessories for women, men and children through its chains and shops around the world. Zara is the largest and internalized of all the Inditex products such as: Massimo Dutti, Pull & Bear, Bershka, Stradivarius, and Oysho. It was firstly open from a businessman called Amanico Ortega in Spain. He has firstly opened Zara in 1975.At 2001 Zara opened 507 stores all around the world. Now in 2012 it has 4400 stores in 73 countries all over the world. The primary place that all the Zara’s clothes are designed is close to Inditex headquarters in La CoruÃta. The point that gives Zara this autonomy and strength to operate independently and be dependable from the others are: its strategy, design, product, manufacturing, delivering, brand name, personnel and financial results. They are divided in three major categories: Zara man, Zara women and Zara kids. Each clothing line has its own split design, sales and procurement, production-planning staffs. There are 200 designers spitted in those three production lines that look after their work during all the steps. The designer of Zara creates approximately 40.000 new fashionable designs and models but only 10.000 of those are produced. The Company had experimented with franchising, joint ventures, and company owned stores. But the problem is which of this to utilize and which was more profitable. Key issues

* Zara nowadays is facing a lot of issues. First of all Zara has a business system that gives it competitive advantages.  One of most important advantages is the economies of scale that it is able to utilize in order to go directly at the distributors.  However, the very fast and continuous growth has brought the company to have problems in the centralized logistics model.  The company is concerned with diseconomies of scale as growth. To prevent this problem and increase potential, it developed a new distribution center in Zaragoza. * Another problem of this company is the large area of expansion and its geographic extent. They want still to expand their market internationally, even thought same territories are still uncertain.  Albania is a problem because the cost of transportation and the barriers cause same problem and increase a little bit the price. * So even Zara is a very well-known company all over the world and their fashionable clothes are likes from a lot of people this doesn’t mean that is easy to enter the market and especially in a small market such as Albania. Firstly is very important to find out the resident population of Albania and how the working age group of the country is. The target group will be the people that will work with the company and they will also be the people that will buy the products. Then it is very important to proceed with same analysis of the company and of the environment of the country that the products are going to enter.

2. Mission statement
We tend to contribute to the sustainable development of society and that of the environment with which we interacts. The company's commitment to the environment includes Inditex Group’s Corporate Responsibility Statement. Our company tends to satisfy costumers expectations producing for them fashionable products for youth and adults and in reasonable prices. 3. Analysis

Macro environment. –SLEPT factors

* Political - This factor refers to the regime policy for involvement in the economy and legal aspects on the impact of business decision making. Zara would need to know the trade system of importing the good in the country. Importing the goods in Albania is very difficult because the procedures to enter goods in Albania are a little bit difficult. The taxes are a little bit higher because Albania is not in the European Union....
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