Pitu Emilia Business Administration Gr 1104

Swot analysis ZARA

I choosed to evaluate the strenghts, weaknesses, apportunities and threats involved in one of the largest international fashion companies,Zara. Zara is a Spanish clothing and accessories retailer based in Arteixo, Galicia founded in 1975 by Amancio Ortega and Rosalia Mera. It is the flagship chain store of the Inditex group; the fashion group also owns brands such as Massimo Dutti, Pull and Bear, Uterqe, Stradivarius and Bershka. There are a total of 1,671 Zara stores. The segment which they are looking for is to create clothes for people with a combination attitude of work and play and the target group si formed by people with medium to high purchasing power who love to look glamorous all time. First of all, I would like to talk about the strengths of this company. Maybe the best strength of them is that they can get fashionable products to market much quicker than rivals, so competing institutions will have an easy time overcoming it. Also, they have a large amount of stores all over the world, in countries such as United Kindom,China,Mexico,Canada,France,Australia,Indonesia and many others. More than this they already have a well established brand name worldwide and their supply chain management is extremely low cost as well as most of their processes like operations, manufacturing are all vertically itegrated. Furthermore, unlike other retailers they handle all their processes as well as follow Just in Time management, their clothes are produced at a low cost with the most innovative and fashionable designs, their products are extremely trendy, well designed and they have a fast delivery of new products. Another strong point of them is that they everyime want customer comments and opinions about their products, services and employees. Secondly, I would like to point out the weaknesses that they have developed in time in this company.First, they use an usual strategy of no advertisments, meaning that they dont do advertisments, TV commercials or any others way of promoting their products. Otherwise, their target

segment is not extremely consumer loyal and might go for cheaper and newer collections. Also, their products are very similar with H&M, Stradivarius and Pull& Bear. Another bad thing about Zara is that their online presence is weak. They havent developed an online service trough costomers could buy clothes or accessories online. Next, Ill talk about their opportunities. Firstly, maybe their best opportunity could be the development in online service. Online markets offer huge growth and a chance to expand. Also they could expand in USA where they have few stores and they also could develop diversified products portofolio. At least I would like to talk about some threats which may affect this company.A potential oversaturiation in Europe is very possible because they have a lot of stores there and people can become bored of this brand. Economic crisis, higher prices than other major competitors and more quality products from the main competitor, H&M consists other threats for Zara. In conclusion, Zara is a well developed company which has a lot of good points and a lot of opportunities in the future, but there are also some bad points and some threats which may affect them.