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Zara Company Analysis - Essay Example

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This marketing report presents a set for recommendations for the fashion retailer, Zara. These recommendations are based on the analysis of external and internal environment. The analysis of the external environment relies on theories such as the PESTLE Analysis and Porter’s Value Chain Analysis. The analysis of the internal environment relies on the analysis of the company using Resource/ Capabilities Analysis and Value Chain Analysis.
Zara is a fashion retailer owned and operated by the Spanish company, Indetix Group. This fashion retailer has introduced a different strategy within the fashion market that goes against the existing strategies of the fashion industry (Anon, nd.). Despite this, or rather on account of this, the company has managed to record profitable growth since its inception. However, in order to pursue further growth, it is necessary to analyze the current strategy.

PESTEL Analysis
PESTLE Analysis is a widely used analysis to understand the external environment of the company. It is an acronym for Political, Economic, Social, Technological, Environmental and Legal factors that have an impact on the overall operations of the organization (Henry, 2008).
Political Factors
Since companies operate within a certain geographic boundary or boundaries, the government has an impact on the company. It impacts through the laws and restrictions placed on the companies. Since Zara operates mainly in Spain and the UK, which falls within the EU countries therefore the political landscape of this area should be understood. The EU is beneficial for the company as it has made the entire region work as a local market. This allows the company to get fair advantage in the entire EU market. Zara is also operating outside Spain and EU markets and in markets such as USA, Dubai and Singapore. In this regard, the company needs to ensure that such countries have friendly relations with the national base of the company which is Spain. Also such countries should have a politically stable government so that the company continues to enjoy friendly terms. Economic Factors In terms of the economic factors, companies all around the world have been seriously hit with the financial crisis that struck the entire world in 2009. This has hampered the buying power on the consumers and most ...Show more
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The analysis of the internal market reveals that ZARA is faring well because of its strong supply chain and its vertical integration. As the company is expanding operations, it needs to reviews its strategy. The analysis leads up to two feasible strategies for the company, namely global expansion and introducing a new plus size in the product range. This report presents these strategies in more detail. …
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