Zara Pestel
Key Elements Which Will Determine Zara’s Profit Growth in the Next Three To Five Years
Introduction
Zara is a Spanish company that starts its business as a clothing manufacturer. It started to grow from a small company over the decades until it possesses few factories that allocate their products to other countries. Zara crosses over the border of its own country, Spain and could be found in upscale locations in the cities like Europe, United States, Middle East, and Asia. Zara has its system of 1603 stores in 78 countries. Its stores are located at high-ended places in the world's major capitals, which target at upper-middle level people (INDITEX, n.d.).
We have discovered a few factors in the macro-environment which we believe they will affect Zara’s profitability in the next three to five years. These factors are: 1. Economic factors 2. Environmental factors 3. Social factors, and 4. Technology factors
However to discuss on the each factors broadly would not bring any substantial understanding to the topic. Hence in these 4 factors we have decided to review on the key elements which we think are going to play important roles in affecting the profitability of Zara in the next few years. 1. Economic Factors a. The Lack Of Main Competitors, Gap And H&M, In China, A Rapid Growing Economy Body
In the year 2006, Zara came into China market. However, Gap and H&M are Zara’s main competitors that are neither in Hong Kong nor in China yet. Zara started up its first stores in China and has many stores opened in different upscale locations in the main cities. Zara has become a very well-liked rapid fashion product in China. With the aggressive expansion of Zara, there are 91 Zara’s outlets in China nowadays (EFU, n.d.).
b. Zara Sales Increases Despite Economy Crisis
Although recession occurred in the year 2008 and 2009, it did not affect Zara’s sales at all but increased net cash received for sale of products and services. In the year
Introduction
Zara is a Spanish company that starts its business as a clothing manufacturer. It started to grow from a small company over the decades until it possesses few factories that allocate their products to other countries. Zara crosses over the border of its own country, Spain and could be found in upscale locations in the cities like Europe, United States, Middle East, and Asia. Zara has its system of 1603 stores in 78 countries. Its stores are located at high-ended places in the world's major capitals, which target at upper-middle level people (INDITEX, n.d.).
We have discovered a few factors in the macro-environment which we believe they will affect Zara’s profitability in the next three to five years. These factors are: 1. Economic factors 2. Environmental factors 3. Social factors, and 4. Technology factors
However to discuss on the each factors broadly would not bring any substantial understanding to the topic. Hence in these 4 factors we have decided to review on the key elements which we think are going to play important roles in affecting the profitability of Zara in the next few years. 1. Economic Factors a. The Lack Of Main Competitors, Gap And H&M, In China, A Rapid Growing Economy Body
In the year 2006, Zara came into China market. However, Gap and H&M are Zara’s main competitors that are neither in Hong Kong nor in China yet. Zara started up its first stores in China and has many stores opened in different upscale locations in the main cities. Zara has become a very well-liked rapid fashion product in China. With the aggressive expansion of Zara, there are 91 Zara’s outlets in China nowadays (EFU, n.d.).
b. Zara Sales Increases Despite Economy Crisis
Although recession occurred in the year 2008 and 2009, it did not affect Zara’s sales at all but increased net cash received for sale of products and services. In the year
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