Business Model
Zara is one of the largest international fashion companies. It belongs to Inditex, one of the world’s largest distribution groups.
The customer is at the heart of their unique business model, which includes design, production, distribution and sales through their extensive retail network.
Zara’s Business model is characterized by a high degree of Vertical integration compared to other models developed by their International competitors. It covers all phases of the fashion process: design, manufacture, logistics and distribution to its own managed stores. It has a flexible structure and a strong customer focus in all its business areas.
The Zara’s business model is unique, comprising each and every stage of the fashion retail business: design, manufacture, distribution and sale of fashion in own-operated stores.
The key to this model is the ability to adapt the offer to customer desires in the shortest time possible. For Zara, time is the main factor to be considered, above and beyond production costs. This signifies there clear cut policy of valuing time even more then money.
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Vertical integration enables them to shorten turnaround times and achieve greater flexibility, reducing stock to a minimum and diminishing fashion risk to the greatest possible extent.
Zara’s team of designers, made up of more than 200 professionals, continuously assessing the customers´ preferences, wishes and demands offering each year comprised some 12,000 different models for sale in its stores. The availability of the factories owned by the company, together with a wide range of highly experienced external suppliers who have a solid commercial relationship with the format, allow Zara to manufacture a model and to have it for sale in its stores worldwide within the average term of approximately two weeks.
Garments, both the in-house manufactured and those purchased from external suppliers, arrive at the hubs Zara has in Spain, wherefrom they are dispatched to the stores worldwide. Clothes are dispatched twice a week, and this frequency allows a continual renewal of our fashion offer.
Zara sells three lines of items, for women, men and children. Each of them has its own independent creative team who carries out the fashion proposals for each campaign. That is why their customers may find in Zara stores, located at the major shopping streets of more than 500 cities in the world, a high quality fashion proposal that takes into account the latest trends at affordable prices.
