who are all well known for their ability to stay on trend and to quickly produce affordable

clothing.

Zara
Zara is one of the world's largest international fashion companies . It belongs to Inditex, the
world’s biggest fashion group. Founded by Amancio Ortega in 1975.
This Spanish clothing retailer owns brands such as Pull & Bear, Zara home and so on. The
company operates over 2,220 stores and is present in 88 countries. Zara has consistently
acted as a pioneer in fast fashion based in a highly responsive supply chain. The customer is
at the heart of a unique business model, which includes design, production, distribution and
sales through our extensive retail network.

Zara’s USP

1. Zara has remained faithful to its core values, expressed simply in the same four
key words that define all our stores: beauty, clarity, functionality and
sustainability.
2. Only a few clothing brands can keep up with the latest fashion while maintaining high
quality of products and selling then at an affordable price. It is no surprise that Zara,
which started off as a small store in Spain is now the world’s largest retailer and its
founder, Amancio Ortega, the 4th richest man in the world. Zara is one of the largest
international fashion companies.
3. Yet no one seems to know very much about Ortega. But without him we’d never
have heard of the term ‘fast fashion’ and our shopping habits would certainly be
very different. The main idea of Zara is to make luxury products accessible to
everyone. Thus, they managed somehow to democratize luxury manufacturer of
products inspired by the evolution of fashion. With this policy, Zara is now an
industry capable of offering trendy products at affordable prices.

For brands like Zara that are not merely profit centric the prospect of growth is
a piece of cake as their vision revolves around collaborative growth based on
smart decisions instead of drastic ones.
Strengths
  Stores: Zara has outlets in 96 out of the 202 countries it sells in. Zara has the most
fashion retail stores in the world, with 2249 locations. The number of retail stores is
about double that of Nike, which has the second-highest number of retail stores.
 Supply Chain: Zara’s supply chain updates its online and retail collections twice a
week. Zara’s ten logistic centres deliver within 48 hours to any region on the planet.
Inditex also has an in-house software development team that is working to increase
the company’s order fulfilment speed.
 Team of Designers: Zara has a design team of 700 trained designers who turn
customers’ desires into designs. Each year, the design team produces 50,000 pieces
of work. It also takes them only three weeks to get the designs from the drawing
board to the shelves.

Weaknesses

 Instant-fashion Trends: Surprisingly, the movement that propelled Zara to the top is
also the source of its most serious flaw. Zara’s issue is to find a way of balancing
sustainability with instant fashion, which is becoming more popular among buyers
and policymakers.
 Physical Store Dependence: Zara’s efforts to reduce the number of physical stores
were pushed by the pandemic. Zara was able to recover from a large reduction in
sales due to COVID-19-related issues thanks to online sales. Even with the increase in
online sales, sales are still only 89% of what they were in 2019.
 Expansion to the US and Asia-Pacific: Zara has a total of 99 stores in the United
States, out of the total 2249 outlets, US stores only account for barely 4.4% of the
total. However, the United States is the world’s largest apparel market. In addition,
Asia-Pacific accounts for 38% of the global apparel market. Zara has a little presence
in both geographies.
OPPORTUNITIES

 Customization: Thanks to AI, collecting data and segmenting the client base after
evaluating it is easier than ever before. This enables clients to receive customized
recommendations. Zara should use this technology to its advantage.
 Sustainability: More than a third of Millennials and Gen Z look for “sustainable” and
“environmentally friendly” labels on clothing, according to the Sourcing General. The
two groups together account for half of the population. As a result, Zara must pay
attention to and respond to this expanding need.
THREATS

 Competition: Shein, the world’s largest apparel shop with an entirely online
presence, is China’s fast-fashion behemoth. The Shein app received 10.3 million
downloads in September while Zara got only 2 million downloads in the same period,
spelling danger for the brand’s future.
 Sustainability: The use-and-throw attitude people had towards fashion is changing.
People are conscious of the impact of fashion on the environment and people. Thus,
Zara would have to push towards making fast-fashion a sustainable business –
economically and ecologically.

H&M
Founded in 1947, Swedish clothing retailer Hennes & Mauritz AB (STO: HM-B), commonly
known as H&M, has grown into one of the most recognizable brands in the fashion
industry. H&M has more than 5,000 stores worldwide and employs 120,000 people.
H&M Usp
Stylish clothes along with a classic look at affordable prices
Strengths
 The store offers quality and trendy clothing at affordable price, we can say designer
clothes at department store prices.
 Their overall delivery time is very low, it takes only 12 weeks for their products to
come from the design stage to the retailer phase.
Weaknesses
 Buying large volumes could lead to overstocking and later on lead to lowering of the
already affordable prices
 H&M have put in a lot of capital and maintenance fee for all the different types of
machines required to produce clothes for each target segment
Opportunities

Better eCommerce Strategies

The online market has already been growing at a steady pace, but when the pandemic
began, and people were forced to stay home, more consumers discovered the benefits of
online shopping. H&M already has a robust online presence, but there is still much room for
improvement, especially now that the online market is growing at a faster rate than ever.

Emerging Markets

Fashion retailers like H&M focus mostly on the upper-class market. But there are several
emerging markets that show great potential for sales, and it would benefit the company to
look into these prospects.
Threats
Strong Competitors

The fashion retail industry has plenty of competitive players, and H&M will have to find
ways to stay ahead of them.

Fakes and Imitations

There is a growing trade in fakes and imitations in the fashion world. As counterfeiters get
better, sales of premium brands like H&M might drop considerably.

Higher Production Costs

The cost of material and labor has been increasing, and even more so in recent years. This is
an uncontrollable factor that can reduce the profitability of H&M's products.

The power of fashion within these companies creates a universal identity structure. H&M
gears their products toward the middle class and a specific gender of women, while Zara
focuses on the middle class as well, they also make sure their consumers are not only female,
but men and children’s products are equally as advertised and sold within this brand. H&M
and Zara’s marketing strategies may be very similar, but the elements that differ are conveyed
by where and how each market is run in different areas of the world.
Differences
By purchasing and developing brands that have unique styles, H&M hopes to appeal to a
wider market of clothing shoppers. Each H&M brand has its own price range and visual
concept
Part of H&M's strategy has also been not to offer just knockoffs but original creations via its
much-ballyhooed designer collaborations with elite labels like Alexander Wang
Zara divides the products sold within its stores into lower garments and upper garments,
with price points being higher for the upper garments. Zara hopes to be perceived as a
high-end retailer with affordable prices.
Its fast turnaround time aids another key Zara strategy: to stuff the stores with more
goods, offering the consumer an unparalleled amount of choice. It produces 11,000-plus
pieces annually, vs. an industry average of 2,000 to 4,000 pieces.2