Inditex is one of the worlds largest fashion distributors, with eight sales formats -Zara, Pull and Bear, Massimo Dutti, Bershka, Stradivarius, Oysho, Zara Home y Kiddy's Class- boasting 3518 stores in 68 countries. (at present) The Inditex Group is comprised of over one hundred companies associated with the business of textile design, manufacturing and distribution. Thanks to its achievements and the uniqueness of its management model based on innovation and flexibility, Inditex is one of the largest fashion distribution groups. Especially Zara, they have shown surprisingly outstanding performance (see Table 1). We analyzed focusing on Zara which accounts for about 70% of total Inditex sales, especially Zara’s distinctive features of business model.
According to financial statement of international apparel companies excluding H&M (we couldn’t search H&M’s annual report), Zara had achieved more than 20% of operating profit rate since 1996 unlike other competitors, it’s awesome. But how did Zara achieve such a great outcome? Actually, Zara were not superior to others in operating expenses rate (see Appendix 4) such as selling and administrative expenses (Although Zara paid marketing expenses much lower than other competitors, they invested a lot of capital in constructing vertical integration). This indicates that Zara’s outstanding
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