ZARA- Business Model
Zara’s business model can be broken down into three basic components:
Concept: To maintain design, production, and distribution processes that will enable Zara to respond quickly to shifts in consumer demands.
Capabilities: It maintains tight control over their production processes keeping design and manufacturing in-house or with some strategic partnerships located nearby . They have strategic agreements with local manufacturers that ensure timely delivery and service. Thus, maintaining the flexibility necessary to design and produce over 12000 new items annually.
Value drivers : for Zara are both tangible and intangible in the benefits that are returned to all stakeholders.
Tangibly Inditex, the parent company of Zara, has 11.02% net margin on operations.
Intangibly, customer loyalty and brand recognition have provided significant value to Zara.