Research study Sample: Business Report on Zara
PART 1: TERMS OF REFERENCE/EXECUTIVE SUMMARY
This report is dependant on Zara Company which is a Zara is a publicly traded apparel company with headquarters in Spain along with other locations within UK and U. S. among other countries. The report is targeted on a critical analysis of the business to identify any issue or opportunity that can be exploited to improve the company’s success. To perform the analysis of Zara, the report can make use of powerful conceptual frameworks which are essential in determining the internal and external business environment within which the company operates. Included in these are; identification of current market situation, SWOT analysis, competitor analysis and PEST analysis. Consequently, the report will present the findings and recommendations for solving the identified problem and the tips for improving the problem. Zara provides a good case to show how a company within the apparel industry can succeed by making a powerful brand and by creating customer value over the entire value chain.
PART 2: METHODOLOGY/PROCEDURE
To determine the current position of Zara and identify the problems or opportunities which remain to be exploited, a critical analysis of the company’s internal and external business environment will be performed. First, the report gives an overview of the company and the current market situation. Secondly, a SWOT analysis that involves analysis of the company’s strengths, weaknesses, opportunities and threats will undoubtedly be performed. Within the SWOT analysis, the strengths and weaknesses will undoubtedly be used to determine the situation within the internal environment while opportunities and threats will be used to offer understanding on the external environment.
Next, a PEST analysis which examines the company’s macro-environment in terms of the political, economic, and social and technological environment is likely to be performed (Gallaugher 2008). Following the PEST analysis, the report will execute a competitor analysis to look for the competitive environment in terms of the strengths and weaknesses of the major competitors (Keller 2012).
The data on competitor analysis is likely to be used to look for the areas that Zara has to improve or whether it will put in place new strategies to handle the competition. At the conclusion of each analysis, the company will give you the strategic implication to indicate what each means for Zara’s success. Finally, the report will pay attention to explaining the identified problem or opportunity in order to offer appropriate tips about how the situation can be improved.
PART 3: FINDINGS
This section gifts the major findings of the analysis of Zara and the implications on Zara’s business strategy. The major findings are split into the following categories:
I. Zara’s current market situation
Zara is a publicly traded company which operates under the parent company the Inditex Group whose headquarters are in Spain, Europe. It absolutely was established in 1975 by named Amancio Ortega. Presently, Zara has more than 1, 600 physical stores positioned in over 77 countries around the globe. Zara’s business strategy within the fashion industry is based on a simple yet effective supply chain system by which new fashion designs are released in just a relatively little while (Keller 2012). Zara’s new fashion products and services are developed within four to five weeks and delivered to the different stores. It is a record turnover time set alongside the industry average which is about six months (Awat and José 2006). Zara is also an industry leader when it comes to developing new designs as more than 10, 000 new designs are released to the market annually.
Besides, Zara posseses an exemplary strategy of production and marketing as it will not rely on heavy advertising and minimizing production costs like other players within the. Instead, the business relies on vertical integration strategy in which the company’s products are produced in a central location and distributed to the worldwide store locations within the shortest time possible. To compensate for the advertising, Zara depends on the strategy of buying attracting and retaining a pool of talented designers who are exceptionally committed in developing excellent designs at a higher rate than the competitors (Awat and José 2006). In this way, the business is able to meet up with the expectations of the customers that are interested in searching for the latest fashion regardless of whether the merchandise are offered at a higher price than the market average. But Zara is moving towards adoption of an on line shopping to avoid overreliance on the physical store locations. The online shopping offers a good opportunity for the business as it looks forward to improve the market share and to deal with the intense competition from the existing international players within the apparel industry.
When it comes to the market, Zara’s products are targeted at clients who are interested in shopping form variety of stylish wear including casual clothes, official wear, shoes, men’s accessories, young ones clothes and cosmetics among other apparel items. Zara offers its customers with a unique chance to sample new fashion trends within a limited time. Besides, Zara’s products are differentiated when it comes to size and cost so that you can increase the customer base. When it comes to location, Zara has many flagship stores which are characterized by superior interior designs with locations in prime areas like in George Street in London, Rathenauplatz in Frankfurt, Pitt Street in Sydney and Van Baerlestraat in Amsterdam among other areas (Keller 2012). When it comes to marketing, Zara does not put emphasis on ads but rather on store locations. The company is looking forward to extent its presence from the standard European markets using a multi-channel strategy to reach to new markets in the U. S. and Asian countries.
II. SWOT Analysis
SWOT analysis is founded on an identification of the company’s internal strengths and weaknesses the external opportunities and potential threats within the operating environment. Zara is a strong brand within the world wide apparel retail industry because ability to develop new designs and avail them to the stores within a limited time. Zara features a strictly vertical integrated structure which enables quick decision making, fast distribution of new designs and cost reduction (Dutta 2002). Zara’s strategy also creates enables it to maximise the sales, enhance customer loyalty and also to create a unique customer value…
