Zara Case Study Answers

Brands provide an opportunity to purchase fashionable, but rather cheap clothes to hundreds of thousands of consumers.The creator of all this, businessman Amancio Ortega, made a world corporation from a small family atelier. By the accomplishment of the two objectives Zara is looking to create enduring profitable growth.

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ABSTRACT Background The brand name of Zara is strong in the market and the company has a strong new product pipeline which presents more than 10000 new designs every year that amounts to approximately 30 new designs a day.

With such an enviable catalogue and the distinction of owning the entire manufacturing setup and controlling it in – house, Zara is leagues apart from other traditional retail houses.

The researchers have identified some issues in Zara’s sales in their Melbourne store.

They believe that lower sales are affecting the finances and hence the underlying causes need to be studied.

Zara definitively use a price differentiation that permits a differentiation between countries: starting with the lowest prices from Spain, then the prices are increasing with 10% for Southern Europe and 70% higher in the Northern countries, fact that is explained by the alignment to the standards of life in that area. Middle Besides its specific capabilities Zara is facing some issues also: ?

Because of an incorrect study the entrance on Argentina market was a failure because when analyzing the market the managers didn't consider all the political and the economical factors. The lack of advertising: There is made only twice a year advertises and that is at the end of seasons for the sales.

The information from the local centers will be sent to the Spain headquarters, in this way; the "design-on-demand" model will be more adapted to the various country specificities.

An optimal solution can be the combination between cost leadership and local responsiveness. Conclusion Zara is one of the biggest retailers in the fashion industry.

Findings Recommendations The Inditex management should provide individual brand-wise performance to truly analyse Zara’s contribution in the group.

A detailed survey of larger sample size and wider number of stores and geographies is required to validate the findings of this research and deduce the problems.


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