ZARA Study On Typical SPA Service Representative In Spain

Background information

Inditex group, known as Spain's textile giant, is ranked first in Spain and ranked third in the world. It has eight clothing retail brands, including: ZARA, Pulland Bear, Kiddy 's Class, Massimo Dutti, Bershka, Stradivarius, Bershka, and Kun.

By the end of 2009, sales had exceeded 11 billion 400 million euros, of which the ZARA brand was the most important.

For a long time, as the group's most famous brand, the number of ZARA branches has been the largest and fastest growing group, and its sales account for about 75% of the total sales volume of the group.

Global business status

By the end of 2009, the Inditex group had a chain of seventy-three countries in the world.

The course of development in China

ZARA officially entered China in 2006, and established the first flagship store in Shanghai. The brand name is "SA La". At the same time, two branches have been set up, that is, SA La Commerce (Shanghai) Co., Ltd. and SA La Commerce (Beijing) Limited. The former is responsible for the sale and related business in the southern region, and the latter is responsible for sales and related businesses in the north.

In 2007, chain stores were opened in Beijing and Hangzhou. Up to now, ZARA has reached 33 stores in China. This does not include some exclusive shops in the shopping mall, and ZARA will continue to expand its chain stores in China.

Analysis of SPA mode management characteristics

Although ZARA is not the only garment enterprise that successfully applies SPA mode, ZARA is undoubtedly the most typical representative of the characteristics of SPA mode.

At present, the most frequently used means of competition in the SPA mode in the world are quick response and low price strategy. The success of ZARA lies in doing deeper and better in these two aspects.

Powerful and efficient

ZARA has a team of more than 200 professional designers who keep up with the trend of fashion. By absorbing the latest fashion design concepts and trends, we have launched highly simulated fashion products, with an average annual launch of more than 10000 products, far higher than other competitors.

The fast design is highly efficient. The ZARA product is not more than a week from planning to production. After that, through professional logistics network, we can ensure that all branches around the world can get a unified new version within 3 days.

And the characteristics of "small quantity and small quantity" can keep all the stores' goods 3 times a week.

ZARA set up its own large-scale production base in Spain headquarters. It consists of 20 cloth cutting, printing and dyeing centers and 500 foundry terminal factories. All production design processes are compressed to the shortest time through the self built conveyor network.

In terms of goods distribution, the arrival time of finished garments is less than two days in the inland area of Europe, while in the US, Japan and other markets, ZARA uses air pportation to achieve rapid delivery.

Shop setting and operation of monopoly monopoly

Excepting a small number of commercial exceptions, ZARA will not do franchising, because every store is an important channel for ZARA brand to obtain market information. All stores will ensure the freshness of the product style by the frequency of two orders per week.

ZARA also understands customers' taste needs through orders from various stores, so that they can be more close to the market's design and production.

It is also the management of vertical integration from production to retail, which improves the speed of commodity circulation, maximizes the cost of operation, and achieves the ZARA's fast parity fashion.

Competitiveness analysis of SPA mode in China

As one of the eight brands of Inditex company, ZARA has two times the total sales volume of several other brands.

As the headquarters of ZARA, Spain has the number of exclusive stores which account for 25% of ZARA chain stores, and is famous for its popular brand.

The local ZARA store is set up in a market segmentation manner. Each store has different customer groups. For example, there are professional women's wear shops, men's wear shops, casual wear shops, children's wear shops, and even household goods stores. The prices are very low. Compared with the price of Chinese ZARA, the price is basically increased by 50-200 yuan at 1:10 exchange rate based on the Spanish local price.

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SPA mode

ZARA has 334 stores in Spain in the year 2009, and its sales volume has reached 75% of the total sales in recent years.

Despite the serious impact of the financial crisis on the sales performance of the Spanish local market, ZARA still maintains its rapid growth momentum through its strong expansion capability in the world market.

SPA mode success factor analysis

The success of ZARA lies in the use of SPA mode to improve the speed of the whole supply system through effective supply chain management, and to reduce the operating cost to the maximum.

Efficient designer team, fast launch of more than 10000 items.

Large and sensitive production base to ensure all products are listed on time.

Fast logistics and distribution, ensure timely update of store products.

Analysis of the operation of SPA mode in China

Since ZARA officially entered China in 2006, the number of Inditex stores in China has exceeded 60, of which ZARA stores are 33, and the number of new stores opened in China accounts for 12% of the world's new stores.

By the end of 2009, ZARA's domestic stores were as follows: 10 in Shanghai, 8 in Beijing, 3 in Shenzhen, 2 in Hangzhou and 2 in Dalian; 1 in Shenyang, Nanjing, Tianjin, Changchun, Harbin, Harbin, Harbin and Nanjing.

Analysis of sales scale in China's SPA mode

In October 30, 2005, SA La Commerce (Shanghai) Co., Ltd. was established, with a registered capital of 6 million US dollars, an additional investment of $11 million in early 2007, and an additional 11 million US dollars in 2008, with a registered capital of US $28 million.

This year's additional investment is based on the rapid development of ZARA in China. According to ZARA official data, from 2006 to 2008, the sales performance of ZARA continued to rise: the main business revenue was 129 million 260 thousand yuan, 250 million 190 thousand yuan, and 369 million 600 thousand yuan respectively.

Analysis of the operation mode of SPA mode in China

ZARA joined the localization strategy on the basis of maintaining the original chain stores in China.

The information system of H structure is built. The information system of each store is parallel and independent, and it is directly connected with Spain. It ensures that all the Chinese stores can send all kinds of sales data and reports directly to the Spanish headquarters every night. Meanwhile, the Chinese offices in Shanghai and Beijing will also understand the information of the store through this information system.

In response to the needs of the Chinese market, ZARA has formed a business strategy team composed of buyers, design and marketing commissioners. Designers can participate in communication negotiations with local suppliers at any time, keep abreast of changes in the market and keep close to the needs of Chinese consumers.

Competitiveness analysis of SPA mode in China

China's consumer market is a typical "long tail market". Large consumer groups and diversified demand choices determine that the so-called few popular hot selling goods have been unable to dominate the sales volume of the entire product system. The traditional clothing manufacturing industry has been pursuing the "small amount" business model in the face of such a multi choice and multi-channel market, and ZARA has just gone the opposite way.

In the actual operation, ZARA also has some problems. According to the field investigation at ZARA Beijing direct store, ZARA has not completely extended the previous mode in the Chinese market. In the updating of product styles, it has not strictly implemented the fast mode of updating every 3 weeks, but according to the sales situation. As for the more popular styles, it will also replenish the order by the direct shop manager organization. As a whole, ZARA's domestic outlets are slower than other overseas stores.

In terms of price, the competitiveness of China's ZARA outlets is also not prominent. The principle of "no outsourcing, no discount", and all goods are imported, leading to the high cost and high price of ZARA compared with similar brands such as H&M and UNIQLO. Compared with domestic leisure fashion brands, its price is even less competitive.

On the whole, ZARA relies on its brand influence in its strong SPA operation mode, European and American fashion styles and relatively reasonable prices to attract consumers.

However, compared with other similar brands and domestic brands, the price is not dominant, and the fast fashion mode has not been thoroughly implemented, which has brought greater pressure to the market competition prospect of ZARA.

The status of customer database resources in China {page_break}

The effective information system mentioned above is a key channel for ZARA to understand the needs of Chinese consumers. ZARA invested more than 1 million yuan in a store in Shanghai, which is devoted to the construction of hardware and software.

Every store manager passes this expensive information system to the sales and inventory information of the headquarters every day. It is an important basis for the ZARA team away from the Chinese market to analyze the styles, colors and sizes of the salable or unsalable products, and the design team can make these analysis data a reference element for new product planning.

With the development of China, the number of stores is bound to increase, and ZARA is also planning to set up a data exchange platform in China. In view of the cost and efficiency of ZARA, all the store data can be aggregated in China and sent back to the Spanish headquarters.