Zara Competitor Analysis

COMPETITORS

The fact that the fast fashion industry has a promising outlook for profitability makes it an extremely competitive field with newcomers entering the market and new collections from famous names being launched on a regular basis. As a matter of fact, Zara has a number of rivals competing to attract customers and gain market share. The biggest threats to the market share of Zara are H&M, Gap and Uniqlo. In addition to these four dominating names, the global market of fast fashion has also witnessed the strong growth of around 39 other retailers, such as Pull & Bear, Next, Mango, Forever 21, etc. Even though Zara has managed to maintain its position as the leader in the industry, its competitors are also continuously increasing

Except for H&M who had sales of $20.2 billion, no brands succeeded in making more money than Zara in 2014, as the net sales of Uniqlo was $16.6 billion, Gap $16.4 Billion, Primark $7.5 Billion, Abercrombie & Fitch $3.7 Billion, Mango $2.1 Billion. However, Zara’s 7% increase in sales was quite low compared to H%M with 14% in the same year. While the European market is dominated by Zara, the Asian countries accounts for an enormous percentage of Uniqlo’s market share and H&M’s biggest markets are Australia, Germany and the US. The US also brings Gap a lot of revenue, even though this retailer has been struggling these days. These brands produce items for both kids and adults but Mango does not concentrate on the young customer segment. Mango’s products are trendy and practical while H&M’s main objective is to provide urban casual wear. Uniqlo follows a unique path: its concentration is fabric, not fashion. It does not offer a variety of styles, but it covers this issue by producing items in almost every color. Regarding distribution channels, H&M invests mainly on physical locations as it has in total 3450 stores

The retailer’s agility proves to be so efficient that even Benetton Group and some other competitors are inspired by it. It is why no retail brand can beat Zara in terms of speed. It is only no more than 3 weeks from the moment you see the 2000-dollar high-fashion items being shown in Versace or Chanel’s latest runway collections to when Zara has the daily version of those clothes on the rack for less than 100 dollars. This amazing outcome results from Zara’s flexibility in the supply chain. Instead than investing in a team of talented and innovative designers who build and develop new fashion trends, Zara takes advantage of the famous and luxury retailers by politely reproducing their designs according to the preferences of the customers. In addition, the feedback system is thoroughly used up in order to help the brand achieve the “fast” objective in offering value to customers since the development team constantly receives information on consumers’ opinions about what changes Zara should make about the clothes to meet their demands. Furthermore, the company operates an exceptionally efficient production chain, comprises of designers, textile manufacturers and labor, with primary plants based in Spain, which means they do not have to spend too much time on outsourcing. Therefore Zara’s stores all over the world are