Pres Article: Zara Intidex

Question 1

What is Inditex’s competitive advantage?

Answer 1

Short design-to-retail cycle using vertical integration and data.

Question 2

How did Inditex use globalization in the 80s/90s?

Answer 2

Exploited trade barriers to have production closer to areas of high demand.

Question 3

What flaw in the traditional fashion industry does Inditex’s fast fashion model address?

Answer 3

Inflexibility of adjusting supply in response to real-time demand changing.

Question 4

How is Zara’s advertising model very different from its competitors?

Answer 4

Only spends 0.3% of revenue on advertising - most is on supply chain operations.

Question 5

How does the “just-in-time” model allow Inditex to address inefficiencies?

Answer 5

Adjust production volumes based on real-time data. Reduces costs.

Question 6

What unique approach does Zara use to maintain low advertising costs?

Answer 6

Rely on word-of-mouth and strategic price allocations.