Zara Fast Fashion Group 10 Report
Case Report: Zara – Fast Fashion
Group #10
David Aparicio, Steven Hurley, Jonathan Williams, & Arjun Yadav
1 External Environment Analyses
1.1 Analysis of General Environment and Driving Forces
The designer apparel environment is influenced by different segments of the external environment such as demographic, socio-cultural, economic, political, technological, global, and physical forces. The designer apparel industry spans globally and is highly competitive among different rivals. It is very labor-intensive that also requires excellent supply chain strategies to quickly deliver products from design to manufacture and ultimately to the consumer. Global consumers have varying demands and price thresholds for designer apparel.
1.1.1 Demographic and Socioeconomic Forces
The demographic being sought is middle to middle-upper class consumers. This includes consumers in developing countries, Europe, Asia, and the US. This creates a very global market and target demographic. The targeted demographic is somewhat seen as fashion-conscience and progressive in terms of trying to stay on top of current trends, yet not pay an unaffordable amount. This definition changes by nations and ethnicity. As an example, Italians and French spent higher than average on clothing when compared to Spaniards. Japanese, though typically conservative, exhibited a very fashion-conscience teenage market segment. The most targeted fashion-conscience age segment are teenagers (age 13-19) and young adults (ages 20-34). A shift in the target demographic or income levels will have a profound effect on the industry.
1.1.2 Economic and Political Forces
The economic driving force in the general environment affects sensitivity to wage increases since designer apparel is very labor intensive. Like the other forces that affect the general environment, economic forces are affected by globalization and the difference in labor costs between countries and meeting local legal requirements. The
Group #10
David Aparicio, Steven Hurley, Jonathan Williams, & Arjun Yadav
1 External Environment Analyses
1.1 Analysis of General Environment and Driving Forces
The designer apparel environment is influenced by different segments of the external environment such as demographic, socio-cultural, economic, political, technological, global, and physical forces. The designer apparel industry spans globally and is highly competitive among different rivals. It is very labor-intensive that also requires excellent supply chain strategies to quickly deliver products from design to manufacture and ultimately to the consumer. Global consumers have varying demands and price thresholds for designer apparel.
1.1.1 Demographic and Socioeconomic Forces
The demographic being sought is middle to middle-upper class consumers. This includes consumers in developing countries, Europe, Asia, and the US. This creates a very global market and target demographic. The targeted demographic is somewhat seen as fashion-conscience and progressive in terms of trying to stay on top of current trends, yet not pay an unaffordable amount. This definition changes by nations and ethnicity. As an example, Italians and French spent higher than average on clothing when compared to Spaniards. Japanese, though typically conservative, exhibited a very fashion-conscience teenage market segment. The most targeted fashion-conscience age segment are teenagers (age 13-19) and young adults (ages 20-34). A shift in the target demographic or income levels will have a profound effect on the industry.
1.1.2 Economic and Political Forces
The economic driving force in the general environment affects sensitivity to wage increases since designer apparel is very labor intensive. Like the other forces that affect the general environment, economic forces are affected by globalization and the difference in labor costs between countries and meeting local legal requirements. The
References: Bjork, C. (2014, September 16). Zara Builds Its Business Around RFID. Retrieved February 7, 2015, from http://www.wsj.com/articles/at-zara-fast-fashion-meets-smarter-inventory-1410884519?mg=id-wsj&mg=id-wsj Bjork, C Diamond, E. (2004). The Fashion Consumer: Identification and Analysis. Fashion Retailing: A Multi-Channel Approach (2nd ed.) Retrieved February 5, 2015, from http://www.prenhall.com/divisions/ect/app/Diamond_temp/source_files/dia76827_ch04.pdf Gaur, P Hankir, Z., & Pendleton, D. (2015, February 3). Lebanese Clan Rides Zara 's Rise to Become Billionaires. Retrieved February 7, 2015, from http://www.bloomberg.com/news/articles/2015-02-04/zara-s-fast-fashion-makes-billionaires-of-lebanese-family Hansen, S Hodge, C. (2012, November 9). Spain’s Inditex Spins Gold. Retrieved February 7, 2015, from http://www.nytimes.com/video/magazine/100000001895335/spains-inditex-spins-gold.html Hoskisson, R Hoskisson, R. et al (2013). Chapter 4: The Internal Organization: Resources, Capabilities, and Core Competencies. In Competing for Advantage (3rd ed.). Mason, OH: South-Western/Cengage Learning. Lu, M. (2013, April 23). Fashion Sense: Apparel Compaires Should Look To Cities for Growth. Forbes. Retreived on Feb 4, 2014 at http://www.forbes.com/sites/mckinsey/2013/04/23/fashion-sense-apparel-companies-should-look-to-cities-for-growth/ People! Zara commits to go toxic-free. (2012, November 29). Retrieved February 7, 2015, from http://www.greenpeace.org/international/en/news/features/Zara-commits-to-go-toxic-free/ Toxic Threads: The Big Fashion Stitch-Up WORLD TRADE ORGANIZATION. (2015, January 1). Retrieved February 5, 2015, from http://www.wto.org/english/tratop_e/texti_e/texintro_e.htm Zara