Zara Model

• Introduction :

The European textile sector is one of the first victim of globalization and price discrimination. The most important textile markets are Europe (135 billion euros), U.S.A (100 billion) and China including Japan (35 billion euros).

In this hypercompetitive environment, brands such as ZARA understood the need to undertake major changes to remain competitive.

Textile industry Companies evolve in a chaotic environment.

In fact, fashion is, by definition, is in constant movement: it represents the tastes and trends. In addition to the uncertainty of time, there is many other variables that must be taken into account in the development of business strategy. So how to fight against this phenomena? To attract customers and win in a hypercompetitive industry they do not use the same strategies.

To protect itself from the fashion market, ZARA chose a vertical integration of the value chain. This strategy is possible thanks to an organization and logistics millimeter. All this enables ZARA to practice management of scarcity, that is to say that the renewal of collections is almost monthly.

• Zara Emergence :

Any company in the textile sector must respond to the uncertainty of a changing clientele as well as weather conditions. The main risk is that the production does not find its market. In addition, ZARA is facing a double competition:

• the basic products from countries with low production costs;

• that global companies product ranges above as others textile companies

In this context, the competition with cheap products is unthinkable. The only solution is to offer products of superior differing ranges as possible. ZARA merchant must become the fastest