ZARA : Fast Fashion
Reflection Paper
Reflection Paper Topic: Write your thoughts about the sources of the advantages of ZARA over its competitors.
Zara is a low-cost retailer with high fashion products. 70% of its revenue comes from Europe and it is a chain store of th Inditex group. Zara has a strong competitive advantage over its competitors and this advantage is generated by Zara’s unique innovative business model. Since 1975 which is the time it was established, Zara had a centralized design, manufacture and distribution model philosophy. While the company was expanding globally it did not changed this centralized model. In addition, this business model of Zara cannot be dublicated by the competitors. This unique business model is centered around the consumer in relation with the aspects of design,production, distribution and sales. Also, another important factor in this design is speed in which they can launch the newest fashion into the market.
The company operates on frequent but small shipping system where there can be 2 seperate deliveries in the same week. It gives customers an new and different shopping experience, because stores have few, selected choices of items which is sold for a limited time. Furthermore, only 0.3% percets of its sales profit are spent on advertising.The company empowers retail managers in order to inform head office about consumer choices and preferences, it operates its own dying plants and does the majorit of sewing work. New fashion products are designed by creative teams and clothing are cheaper than the competitor. In addition, Zara’s online store strategy enables them to shorten their turnaround time, visualize a high-virtualized sales network and increase their flexibility.