Inditex is the largest fashion retailer in the world, it has seven chains, they are Zara, Pull and Bear, Massioino Dutti, Stradivarius, Bershka Oysha and Uterque. SWOT analysis might help the executive to understand the opportunities and threats in the environment with the strengths and weakness of Inditex; thus help the executive to evaluate existing strategies and formulate the new master strategies (growth strategy, stability strategy and retrenchment strategy). Such as allocates resources, address the overall direction, support to its retail concepts, and international expansion and new concepts in existing markets. For example, SWOT analysis showed that there are competitors are working to be faster at fast fashion, it should be threatened Zara’s leading advantage, therefore the executive exploit other strategies the keep the advantage in the market, such as develop new method to store managers to order and merchandise display faster, and adding the new shipping routes for products; and jump into online retailing.
For Zara’s managers, SWOT analysis might help them to understand their strength and weaknesses with the opportunities and threats in the business environment for their company. Then they can evaluate or formulate the business-level strategies base on those factors to improve or maintain the competitive advantage in the market, and implement the corporate strategic plan. For example, Zara implements “small quantity production” principle, this is the strength, because can lower the inventories risk and cost, this is the competitive advantage. Therefore Zara’s managers after consider this element, they keep on going this policy and trying to keep this advantage.
I think Zara pursues both differentiation and cost advantages:
Zara implements “fast fashion”, it gets the product to market quickly, small quantity production, and release new fashion frequently. It does not like its competitor took six months from design to consumer and mass production; so it often lets the customer feel fresh and attract consume constantly.
Zara sells high-fashion look-alikes with affordable price, if compared with the...