Individual Management and Operations Report on Zara (363LON)

This report provides a comprehensive analysis of Zara's management and operations. It begins with an introduction to Zara and its market position, followed by a PESTLE and SWOT analysis to assess the external and internal factors influencing the company. The report then delves into Porter's Five Forces and the Ansoff Matrix to evaluate Zara's competitive landscape and growth strategies. Further, the report examines Zara's product and pricing strategies, value chain, supply chain management, and marketing strategies including place and promotion. Finally, the report concludes with recommendations for Zara's future development and growth within the fashion industry, based on the preceding analysis.

INDIVIDUAL
MANAGEMENT AND
OPERATIONS REPORT

TABLE OF CONTENT
INTRODUCTION...........................................................................................................................3
MAIN BODY..................................................................................................................................3
Context & concept.......................................................................................................................3
Product & price............................................................................................................................7
Supply Chain...............................................................................................................................7
Place & promotion.......................................................................................................................8
RECOMMENDATION...................................................................................................................9
REFERENCES..............................................................................................................................10

INTRODUCTION
Management and operations in an organization are very important for the company to
have so that there is going to be superior presentation which is going to be present in the market.
Zara was founded in 1975 and is having more than 2,270 stores which is a great achievement of
the organization. The company’s revenue is €18,021 million as of 2018. The report is going to
consist of price, products, concepts and promotions which the organization has been using in the
market to be able to operate efficiently in bazaar which is going to make the organization have
higher performance.
MAIN BODY
Context & concept
PESTLE
 Political factors
There are a good maintained laws and policies which Zara is following in the market so that
the organization will be able to operate effectively. The company is so focused on customers that
the labour retention of the company is not being maintained.
 Economic factors
The GDP and unemployment rates worldwide are improving which can be used as a great
factor for the company to have in the market so that there is going to be higher pricing and
economic factor which business can have (Urrea and Pedraza-Martinez, 2019).
 Social factors
Trends and demands of customers are also changing which is why there is good designing
which is being done by Zara which is a great factor.
 Technological factors

The company is having a lot of investment in the company which is good for the overall
development of the organization.
 Legal factors
There are a lot of policies and laws which are present for the customers and employees of the
organization which are being followed to some extent which is good for the functioning of the
organization (Gölzer and Fritzsche, 2017).
 Environmental factors
The business has made a lot of environmental friendly measures already which is going to
make the performance of the organization be well maintained which is important for the
organization to have.
SWOT
 Strengths
The company is getting a high experience and standard for them which is why they need to
maintain this factor. The company will have to make sure that they are having the right measures
and strategies which are being used in the company so that the organization will be able to
operate effectively. Zara is having good management which is experienced therefore the
company is being able to get a competitive advantage despite of having a large scale of
competitors in the market.
 Weaknesses
The company is not having a strong employee base which is going to make the organization
not be able to operate effectively. The wages of the employees are not being paid effectively
which is not a good factor since the demands of the customers are not being matched.
Technological investment is also low in the organization which can get limitations on the
working and productivity of the company.
 Opportunities

There is right transparency which can be used by the organization to be able to gain the
loyalty and trust of the customers and employees. Investing in research and development
department is going to help the company to get in new ideas which is going to be profitable and
unique identity is going to be gained by the company in this competitive market which is a great
factor (Gaye, 2017).
 Threats
The competitors like M&S, H&M, Forever 21, etc are taking away the market share of the
company which is going to make a negative impact on the economic factor. Therefore it is
important for the company to be able to get in the right changes from time to time according to
the customers and employees of the organization so that there is going to be effective working.
Porter’s five forces
 Bargaining power of suppliers (Medium)
There are multiple channels of suppliers which the company has been able to develop for
themselves in the market which is going to make the company have higher performance. Zara
shifts from one supplier to another to have cost friendly measures to be able to operate
effectively.
 Bargaining power of customers (Low)
Customers are satisfied with the changes and designs which the company is getting in the
market because they are according to the trends in the market which is a great factor for the
company to maintain the loyalty of the customers (Queiroz and et.al., 2020).
 Competitive rivalry (High)
There is a lot of competition in the market in this industry which are H&M, M&S, Forever
21, etc which are going to take away the market share so that there is going to be higher
performance and economic stability in the market.
 Threat of new entrants (Low)

The company is not going to have entrants in the market which is going to be of great loss.
Zara has invested a lot in this industry so that there is going to be better functioning and higher
performance which is going to be present (Roesch-McNally and et.al., 2018).
 Threat of substitute (High)
There are a lot of substitute which Zara can have for their products and services in the market
which needs to be maintained and for that the company will have to take patents and copyrights
on their designs and other aspect in order to operate effectively.
Ansoff Matrix
 Market penetration
Making the existing product in existing market being present in the market so that there is
going to be effective working. Sometimes the customers appreciate the same old product which
is why the organization must maintain the quality and performance of the product in the existing
market.
 Product development
The products have to be developed with the trends and demands of the customers and have to
be tried in the existing market so that there are going to be lesser risks which are going to be
involved. The company is going to have higher competitive advantage which is that there is
going to be higher performance which is going to be present by the company.
 Market development
Existing products must be tried in new markets as well because the company gains
confidence of the existing product which is going to be very good for the overall development of
the company in the market (Feng and Shanthikumar, 2018).
 Diversification

This is a very risky strategy which a business can take in the market therefore it is mostly
used by experienced and knowledgeable companies so that they would be able to perform
effectively. Zara is using this strategy since they have gained a market value and portfolio so that
there is going to be higher sales.
Product & price
Product
The designs, quality and development in the company is highly present which is making
the organization be able to develop and gain the competitive advantage in the market which is a
great factor for the company. The company has been able to understand the demands and needs
of the customers and with the right target the company can have cost friendly strategy as well by
getting in the best raw material for the productivity and operations of the organization as well
which is present in the market (Karlsson, 2016). The trends and demands of the customer’s
lifestyle is changing which needs to be adopted by the company so that there is going to be
higher performance.
Price
The company is having high pricing for the products and services since there is high
quality and standards of the customers which is being provided by the company. It is important
for the organization to be able to provide the right information to the customers. There are
discounts, sales and offers which are informed by the company to the customers so that there is
going to be higher performance which is going to be present. The company is having the right
target in the market as well which is very good for the overall development and economic factor
of the company in the market as well which is going to make the performance and maintain the
value of the company in the market as well.
Supply Chain
Value chain

 Primary activities
Primary activities are inbound logistics, operations, outbound logistics, marketing & sales
and services which have to be well maintained so that the company will be able to give in their
personal best. These are the basic factors which Zara has to take care of so that there is going to
be higher performance which is going to be present in the market. The company needs to gain
competitive advantage and this is good framework which Zara can focus upon so that the
company will be able to function effectively and efficiently (Villa and Castañeda, 2019). The
final product of the company must be appreciated by the customers of the organization and
targets have to be achieved from time to time so that the company can have higher performance
which is going to be present.
 Support activities
The activities which are present in support activities are firm infrastructure, human resource
management technology and procurement. These are the external factors which can be controlled
by the organization if they are focused upon so that the company will be able to operate
effectively and efficiently in the market. Human resource and technology can be made stronger
by hiring the right workforce in the company which is having good experience and performance
in the market and have the basic knowledge as well of the company.
Place & promotion
Place
The company is having more than 2,270 stores worldwide which is a great way of
reaching out to the customers. The company has also been able to adapt to online platforms
which is a great factor for the company to have which can make the performance of the company
be improved in the market (Damnjanovic and Røed, 2016). Customers are wanting products
online because the lifestyle of customers have changed and it is important for the company to be
able to give what is expected out of the customers for them so that there is going to be good
performance which would be present. The infrastructure of the stores is also good which is going
to attract more customers in the organization making the sales increase.

Promotion
The company is making sure that they are providing the right platforms in the market for
making sure that the company is going to have the right and expected sales in the market which
is good for the performance level of the company. The company is using marketing
advertisements and word of mouth which is not very good for the sales to be increased but the
infrastructure it is important for the company to be able to make sure that they are having good
promotions in the market (Tönnissen and Teuteberg, 2020). Zara will have to promote their
products and services in the market so that they would be able to perform effectively in bazaar
which is important for the value and standards of the company.
RECOMMENDATION
Zara will have to work upon their standards and reputation in the market currently since
the market share is being taken away. The company will have to make good investment in
technological and research and development department in order to be able to operate
effectively. The demands of the customers and delivery to the customers are not on time which
needs to be present so that the company can gain competitive advantage in the market.
The company will not just have to focus on the external factors but all the internal factors
like the employees. The satisfaction and motivation level of the workforce is very low which
needs to be improved so that firm will be able to gain a superior performance in the market
which is going to make the company be able to operate effectively. The company will have to
make sure that the retention level of the employees is being maintained and the pressure on them
is lesser so that they would be able to give in their personal best (Cui and et.al., 2019).

REFERENCES
Books and Journals
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