[국제경영] 패션 Zara 자라 국제확장 전략(영문)

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2009.08.18 / 2019.12.24
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목차: Industry Analysis: Public Ready-To-Wear Industry
The Drivers of Zara’s Rapid Growth
Internal Analysis: Zara’s Value Chain
Zara’s International Expansion
Asia: The Fastest Growing Market
Issues Associated with the Asian Market Expansion
References:

본문내용: Industry Analysis: Public Ready-To-Wear Industry
Public Ready-To-Wear (RTW) industry is the term used to describe clothing collections which are based on the most recent fashion trends presented at Fashion Week in both the spring and the fall of every year. These trends are designed and manufactured quickly and cheaply to allow the mainstream consumer to take advantage of current clothing styles at a lower price. This philosophy of quick manufacturing at an affordable price is used in large retailers such as H&M, Forever 21, Zara, and GAP. The primary objective of most companies is to quickly produce a product in a cost efficient manner. This efficiency is achieved through the retailers’ understanding of the target market's wants, which is a high fashion looking garment at a price at the lower end of the clothing sector. Primarily, the concept of category management has been used to align the retail buyer and the manufacturer in a more collaborative relationship. Category management is defined as "the strategic management of product groups through trade partnerships, which aims to maximize sales and profits by satisfying customer needs". This collaboration occurs as many companies’ resources are pooled to increase the market's total profit. The market utilizes this by uniting with foreign manufacturers to keep prices at a minimum.
There are two crucial factors to succeed in the Public RTW industry, maintaining brand/design leadership, and establishing efficient Supply-Chain-Management (SCM), respectively. Through the industry structure analysis, this industry is mainly characterized by high level of industry rivalry, and buyer power. This is because there are a lot of players competing in the market and customers whose switching cost is very low. (Exhibit 1) Therefore, achieving the responsiveness to market needs/trends and distributing the products in time are the keys to survive in competition.

The Drivers of Zara’s Rapid Growth
“The middle-aged mother buys clothes at Zara because they are cheap, while her dauthter aged in the 20s buys Zara because it is fashionable.” -By Devanhshu Dutta-

Among many competitors, Zara’s products and brand image are characterized by high-fashion and low-medium price. (Exhibit 3) Generally, these two characteristics couldn’t be easily achieved at the same time. However, Zara has been able to achieve this due to its core competencies that provide the all steps of the production process with a competitive advantage over traditional retailers in the industry. Many retailers in the industry usually outsource all of their production while focusing on distributing and retailing those goods. This is due to the fact that the global apparel industry is “highly-labor intensive” rather than capital intensive. That is why a lot of fashion retailers and apparel manufacturers are always seeking to lower costs by outsourcing production to developing countries where the labor cost is very low. However, Zara has developed a successful diverse method of doing business in the fashion industry, by working through the whole value chain, which is very vertically integrated. This vertically integrated business system of Zara has allowed the company to successfully create a climate of scarcity and opportunity as well as a fast-fashion system. Therefore, Zara has been able to be flexible in the variety, amount, and frequency of the new styles they produce. Also, 85% of the production is done through the season, which allows the chain constantly provide its customer with updated products. Furthermore, Zara has a quick response system, which allows the company to respond to the demand of its customer better than the competitors. For example, Zara’s product development teams are responsible for attending high-fashion fairs and exhibitions to translate the latest trends of the season into their designs. Also, Zara’s product development teams are constantly researching the market by traveling to universities, and clubs to track customer needs. These activities and efforts enable the company to achieve high-fashion brand image.
In addition to high-fashion brand image, Zara has achieved affordable price. This is due to the fact that Zara has amassed centralized distribution facility gives the chain a competitive advantage by minimizing the lead-time of their goods. Zara’s internally or externally produced merchandise goes to the distribution center. This is cost-effective due to the close proximities of the distribution center in Arteixo and their factories in Coruna.

Internal Analysis: Zara’s Value Chain
If we look deeper into Zara’s business process, we can draw a value chain that consists with five steps of business activities. They are research and design, inbound logistics, manufacturing, outbound logistics, marketing and sales.
The first step of the process is its researc

참고문헌: 1. Inditex Annual Report, FY2006, FY2007, FY2008

2. Inditex Annual Result Report FY2003, FY2006, FY2007, FY2008

3. Critical Success Factors for International Fashion Retailers Entering Foreign Markets, FIBRES & TEXTILES in Eastern Europe October / December 2007, Vol. 15, No. 4 (63), written by Bruno Završnik

4. Success stories: Ideas for potential players – Zara Japan corporation, Jetro, 2009

5. Retail @ the speed of fashion, www. 3isite.com, written by Devangshu Dutta

6. Salmon, Walter J., and David Wylie. "Gap, Inc., The: Building a Brand." Harvard Business School Case 593-043.

7. http://www.wikipedia.org, Keyword "Zara"

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