Zara’s Business Model, Information and Communication Technologies, and Competitive Analysis :: essays research papers

Question 1 Zaras Business Model and Competitive AnalysisZara, the most profitable target of Inditex SA, the Spanish clothing retail group, opened its first store in 1975 in La Corua, Spain a city which eventually became the central render for Zaras global operations. Since then they have expanded operations into 45 countries with 531 stores set in the most important shopping districts of more than cd cities in Europe, the Americas, Asia and Africa. Throughout this expansion Zara has remained focused on its core make philosophy that creativity and quality design together with a rapid response to market demands will yield profitable results. In baseball club to realized these results Zara developed a business model that incorporated the side by side(p) common chord goals for operations develop a system the requires short glide by times, decrease quantities produced to decrease inventory risk, and increase the number of available styles and/or choice. These goals helped to f ormulate a unique value proposition to combine check prices with the ability to offer new clothing styles faster than its competitors. These three goals helped to take shape Zaras current business model. Zaras Business ModelZaras business model can be broken down into three basic components concept, capabilities, and value drivers. Zaras fundamental concept is to maintain design, production, and statistical distribution processes that will enable Zara to respond profligately to shifts in consumer demands. Jos Mara Castellano, CEO of Inditex stated that "the fashion world is in constant intermingle and is driven not by supply but by customer demand. We need to give consumers what they want, and if I go to South America or Asia to make clothes, I simply cant move fast enough." This highlights the importance of this quick response time to Zaras operations.Capabilities of Zara, or the required resources needed to run the opportunities and execute this conceptual strategy, are numerous for Zara. Zara maintains tight control over their production processes keeping design and manufacturing in-house or with some strategic partnerships located nearby Headquarters. Currently, Zara maintains 80% of its production processes in Europe, 50% in Spain which is very close to La Corua headquarters. They have strategic agreements with local manufacturers that hold timely delivery and service. Through these strategic partnerships and the benefits brought by this proximity of manufacturing and usable processes, Zara maintains the flexibility necessary to design and produce over 12000 new items annually. This potentiality allows Zara to achieve their strategy of expedited response to consumer demand.