A review on the key factors that contribute to Zara’s success.docx

A review on the key factors that contribute to Zara’s success.docx

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A review on the key factors that contribute to Zara’s success 1. A brief introduction to Zara’s history Established in 1975 as Zorba, Zara is a Spanish fast fashion (clothing and accessories) retailer co-founded by Amancio Ortega Gaona (a Spanish business tycoon) and Rosalía Mera Goyenechea (a Spanish businesswoman and entrepreneur) (d'Andria & s Gabarret, 2017) . Based in Arteixo, Galicia (Spain), Zara is the major brand of the Inditex group, which is one of the world’s largest apparel retailer and owns other brands such as Bershka, Massimo Dutti, Oysho, Pull & Bear, Stradivarius, Uterqüe and Zara Home (Ghemawat, Nueno, & Dailey, 2003). 1975 witnessed the opening of the first Zara store in downtown A Coruña, Galicia, Spain. Named after the classic film Zorba the Greek , this store was initially called Zorba. Later, to distinguish the store from the bar using the same name two blocks away, Amancio Ortega rearranged the letters and changed the name into “Zara”. It is alleged that the extra “a” came from an additional set of letters which had been selected for the organization (Ortiz Cuadrado, 2016). Ortega opened another 9 chain stores in the biggest cities of Spain, featuring inexpensive lookalike clothing of higher-end and popular clothing fashions (Sull & Turconi, 2008). Then in the 1980s, the Inditex group was incorporated as a holding company, establishing the foundation for a distribution system which was developed to react effectively and efficiently to the changing market trends. Ortega modified the design, producing and distribution procedure to decrease lead times and keep pace with the latest fashions by setting up fashion designer groups and taking advantage of the information technologies.
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In 1988, Zara began its international expansion through Porto, Portugal (Lopez & Fan, 2009). The company entered the United States in 1989 and opened the first shop in France in 1890. After expanding to Mexico in 1992, Zara opened boutiques in Belgium, Greece and Sweden in 1993. Entering the 21 st century, Zara stores were set up in Singapore and Japan (2002), Malaysia and Russia (2003), China, Estonia, Hungary, Romania and Morocco (2004), Costa Rica, Indonesia and the Philippines (2005), South Korea (2008), India (2010), and Australia and South Africa (2011) (Ghemawat et al., 2003). In addition to the brick and mortar shops, the company started to offer online shopping service in France, Germany, Italy, Portugal, Spain and the United Kingdom on September 2010 (Colla, 2004). Two months later, the online shopping sites were expanded into another five countries: Austria, Belgium, Ireland, Luxembourg and the Netherlands. Additional online shops were set up in the United States in 2011, Canada and Russia in 2013, Romania, South Korea and Mexico in 2014, and India in 2017 (Sternquist & Goldsmith, 2018). Zara now has over 2,250 chain stores set up in major cities within 96 countries around the world.
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  • Three '17
  • Bouanar Jack
  • Inditex, Fast fashion, A Coruña

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