ZARA's Business Model

Clothing plays a very important role in day-to-day life. Appropriate clothing is very important as per the type of occasion you are attending. Obviously, we will not wear a swimming costume to a party or a sweater in the winter season. Different people prefer different brands of clothing. Fashion is now taken as a career aspect by some. ZARA is one of the top brands today which is famous among people.

ZARA is a Spanish clothing and accessories retailer based in Arteixo, Galicia. ZARA is one of the most well-known brands in the world and is also one of the largest international fashion companies. The company specializes in fast fashion and products include clothing, shoes, perfumes, beauty, and bags.

The parent organization of ZARA is Inditex. Inditex is a Spanish multinational clothing company that owns ZARA, H&M, and GAP. It was founded on 24th May 1974 by the founders,  Amancio Ortega, Rosalia Mera. The CEO of the company is Oscar Perez Marcote. ZARA has about 2000 stores in various locations worldwide. Stores are located in prime retail areas where human traffic is high. 

ZARA's Business Model:

1. Design: Designers don't work in a silo, they remain in constant touch with customers. The designers are high professional designers. 

2. Sourcing and Manufacturing: 80%-90% of production takes place in Europe. Fabrics for the cloth are from Italy ad France. The stitching work is done in workshops by the subcontractors. When the clothes are stitched, they are sent back to the headquarters for final quality and check. Garments are packed with minimal human intervention.  

3. Distribution: After the final check from the headquarters, garments are placed as per the requirements of shops of a particular place.

4. Retailing: Stores of ZARA are brand new and well furnished. The price of garments is affordable and complimentary clothes are put together for customers to ease the choice. This high level of standardization and a unique philosophy of retailing allows them to serve their customers well. 


ZARA launches approximately 11,000 new items per year compared to 2,000-4,000 for H&M and GAP. ZARA holds 6 days' worth of inventory while H&M holds 52 days and Spanish retailer holds 94 days of inventory.

Marketing Strategy:

ZARA's strategy is market-oriented and believes in fast fashion. They have designed nearly 40k products out of which 12k design reach store. This is the key to fast fashion. Its strategy is to adapt to its offer to the new markets.

ZARA adapts its items in each country according to clients' fashion trends and store sales. This flexibility is ZARA's secret to success and lies in the extensive network of shoppers with feedback given from a wide range of people from different cultures and generations.  

With 1000+ designs a month ZARA often updates its collections according to sales reported to Spain. This quick turnover helps continuously provide new designs by making them available in stores through shipment every two weeks attracting customers to often visit the shop.

Indeed ZARA has very little inventory because of its demand-based production pushing customers to hurry to the shop before they run out of stock. This allows ZARA to have cost-effective production y lowering the storage cost. ZARA brings out new styles that are trendy and fashionable available at affordable prices.

ZARA is fast than its competitors in terms of interpreting trends that are on the runway from high professionalism because of the right team of designers. 

Key success factors of ZARA: 

1. Extensive market research is done before designing a garment.

2. It provides new styles that are trendy and fashionable.

3. Products are available at an affordable price.

4. Highly skilled designers work with ZARA.

5. ZARA provides more styles which means more choices.

6. In a short time, more fashionable clothes are available.