Zara
ZARA
By John M. Gallaugher
A look inside the innovative techniques of one of the largest fashion retailers
2012
Joshua Crocker
MGMT 3030
12/19/2012
ZARA
By John M. Gallaugher
A look inside the innovative techniques of one of the largest fashion retailers
2012
Joshua Crocker
MGMT 3030
12/19/2012
A Goldman analyst once described this fashion retailer as “Armani at moderate prices” and another suggested that fashions were “Banana Republic” while prices were “Old Navy” (Folpe, 2000). Based on any shopping experience, would this sound like a hoax or too good to be true? Well, this fashion retailer is Zara, a subsidiary of Inditex Corporations located centrally in La Coruna, Spain. And through innovative techniques ranging from little advertisement, no line sales, and the ability to produce most products in-house, Zara has established itself as described by LVHM as ‘the most innovative and devastating retailer in the world’ (Surowicki, 2000). This analysis will look into these innovations and how they are applied to the world of fashion, and more specifically the operations of Zara.
When talking about a business in any given industry, any C-level manager will say that their company is about the customer first. That what the customer asks for is what the company will provide for them. Well, it sounds all well and good but how many of these companies have the statistical proof that they are satisfying. By taking a look at the conventional methods of a fashion retailer, we can compare what Zara did right to what the other guy did wrong. Let’s use the example of Gap. During the 90’s, Gap had a great turnover rate from shelf to the consumer. CEO at the time Mickey Drexler, a man known for style, even revolutionized the khaki pant-button down combination as America’s business casual (Gallaugher, 2008). When sales declined in the early 2000’s, Drexler was left with the decision on where Gap would head next. A decision that appeared to be made with no
By John M. Gallaugher
A look inside the innovative techniques of one of the largest fashion retailers
2012
Joshua Crocker
MGMT 3030
12/19/2012
ZARA
By John M. Gallaugher
A look inside the innovative techniques of one of the largest fashion retailers
2012
Joshua Crocker
MGMT 3030
12/19/2012
A Goldman analyst once described this fashion retailer as “Armani at moderate prices” and another suggested that fashions were “Banana Republic” while prices were “Old Navy” (Folpe, 2000). Based on any shopping experience, would this sound like a hoax or too good to be true? Well, this fashion retailer is Zara, a subsidiary of Inditex Corporations located centrally in La Coruna, Spain. And through innovative techniques ranging from little advertisement, no line sales, and the ability to produce most products in-house, Zara has established itself as described by LVHM as ‘the most innovative and devastating retailer in the world’ (Surowicki, 2000). This analysis will look into these innovations and how they are applied to the world of fashion, and more specifically the operations of Zara.
When talking about a business in any given industry, any C-level manager will say that their company is about the customer first. That what the customer asks for is what the company will provide for them. Well, it sounds all well and good but how many of these companies have the statistical proof that they are satisfying. By taking a look at the conventional methods of a fashion retailer, we can compare what Zara did right to what the other guy did wrong. Let’s use the example of Gap. During the 90’s, Gap had a great turnover rate from shelf to the consumer. CEO at the time Mickey Drexler, a man known for style, even revolutionized the khaki pant-button down combination as America’s business casual (Gallaugher, 2008). When sales declined in the early 2000’s, Drexler was left with the decision on where Gap would head next. A decision that appeared to be made with no