Zara's Global Business Operations: Benefits, Drawbacks, and Challenges

This research project examines the benefits and drawbacks of a global business environment, using Zara as a case study. The introduction provides an overview of Zara, its rationale, aim, and objectives. A literature review explores the concept of globalization, its factors influencing the fashion industry both positively and negatively, and the challenges Zara faces. The research methodology outlines the research type, approach, design, sampling, data collection, and analysis methods. The report aims to understand the conceptual framework of globalization, identify its impact on the fashion industry, determine Zara's challenges in selling goods globally, and provide recommendations for business expansion. The report covers Zara's history, revenue, and global presence, highlighting key factors influencing globalization such as technology, trade, and cultural assimilation. It also discusses challenges like omni-channel integration, employee productivity, inventory management, and price transparency. The research employs both quantitative and qualitative methods to address these issues, providing a comprehensive analysis of Zara's global business strategies.

RESEARCH PROJECT

Table of Contents
TOPIC..............................................................................................................................................1
INTRODUCTION...........................................................................................................................1
Overview of the company......................................................................................................1
Rationale.................................................................................................................................2
Aim and Objectives................................................................................................................2
LITERATURE REVIEW ...............................................................................................................2
Introduction............................................................................................................................2
Detailed meaning and concept of globalisation......................................................................3
Factors of globalisation that influence the fashion industry both in positive and negative way.
................................................................................................................................................3
Challenges faced by Zara in selling goods and services across the boarders after globalisation.
................................................................................................................................................4
Recommendation....................................................................................................................5
RESEARCH METHODOLOGIES.................................................................................................5
Introduction............................................................................................................................5
Research type..........................................................................................................................5
Research Approach.................................................................................................................6
Research Design.....................................................................................................................6
Sampling.................................................................................................................................6
Data Collection.......................................................................................................................7
Data Analysis..........................................................................................................................7
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................8

TOPIC
“To identify the benefits and drawbacks of a global business environment. A case study
on Zara.
INTRODUCTION
Globalisation is very popular topic in the business as describes the growing
interdependence of the worlds economies, population and cultures. It is the process by which
businesses or other organisation develop international influenced or start operating on an
international scale. GlobalisationIt is not only beneficial for the business sector but it is very
profitable for economy as well (Bengtsson and Östman, 2016). There are number of factors
which are benefited and greatly improved by globalisation like education, technology,
competition, trade, investment, employment, capital flows, structure of organisation and culture.
After globalisation it becomes easy for the organisations to trade across the boarders by which
companies expand their business more. Globalisation directly increases sales and profitability of
company. The production, distribution as well as channels of marketing of fashions industry is
greatly influenced after globalisation, In fashion industry the most important impact is cultural
assimilation. After, globalisation it becomes very easy to sell and purchase goods and services
from other nations. The quality of goods and services are also improved a lot after globalisation
just because of advance technologies. For fashion industries, organisation have to create designs
for clothes, shoes and accessories.
In this present proposal, research problem and questions are defined. Further, literature
review section will be added that provides background and conceptualisation of the proposed
area of the study (Cattan, 2016). Moreover, it also examines research methodology as well as
process of research used by the researcher. Clear justifications will also provide researcher on
selecting of particular research methodologies.
Overview of the company
Zara is well-known fast fashion clothing and accessories brand. It is retail company
founded in 1975 by Amancio Ortega. It is the main brand of Inditex group which is the world
largest apparel retailer. Its headquarter is located in Arteixo, Span. The revenue of the company
is €" 25.34 billion in 2017. Zara sells its products in many countries,
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Rationale
Globalisation is very well-known topic since many years as well as on globalisation there
was extensive studied are conducted around the topic to identify the benefits and drawbacks of a
global business environment (Schriewer, 2017). A case study on Zara. The reason for choosing
the topic for study is that it is fact that trade are increasing across the world after globalisation
which affect both positively and negatively to the organisation. Thus, the best thing of
globalisation is that it does not only benefit companies but it also effective for the country's
growth and development.
Aim and Objectives
Aim: “To identify the benefits and drawbacks of a global business environment. A case study on
Zara.
Objectives:
 To understand conceptual framework of globalisation.
 To identify the factors of globalisation that influence the fashion industry both in positive
and negative way.
 To determine the challenges faced by Zara in selling goods and services across the
boarders after globalisation.
 To provide recommendation to expand the business by gaining opportunities from the
market.
Research Questions
1. What is the detailed meaning and concept of globalisation?
2. What is the factors of globalisation that influence the fashion industry both in positive
and negative way?
3. Which countries Zara is selling its products and where they source their products
from?
4. What are various challenges Zara is facing in the global environment and what the
impact it has on its operations.
5. What are the recommendation to expand the business by gaining opportunities from
the market?
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LITERATURE REVIEW
Introduction
Literature review is very important as it provides a search and evaluation of the available
literature review of the chosen area or topic. With the help of this section, the actual concept of
globalisation, its impact as well as challenges are search and evaluated. There are four themes in
this present section.
Detailed meaning and concept of globalisation.
According to the Psimmenos, (2018) globalisation is the process of selling goods and
services across the borderers or creating presence across the global level. The movement of
goods and services across the boarders is called as globalisation. In order to maximise the return,
companies start selling goods and services to other countries. The best thing about globalisation
is that, it is not only increases the profitability of company, but it also raises the growth and
development of economy.
As per the Berenskoetter, (2017) there are various factors that influences globalisation
which are historical, economy, resources and market, political, production issues, industrial
organisation and technologies. It has been noticed in earlier time that routes of trade were made
in order to move the goods from one kingdom to another. For example- silk route from east west.
Further, economy is another factor that influences increasing the movement of goods and
services across the boarders where the overall economies of a specific sector or trade is a very
essential component in globalisation.
Wang, (2015) said that, resources and market is another factor which influenced
globalisation such as minerals, gas, oil, coal, water, human resource and many other that make
essential contribution in globalisation. Another reason which deliberate organisations to look
global is production issues like over production and sluggishness in domestic market. In addition
to this, issues in political aspect of countries also lead to make country at global level. For
example. European Union, SAARC and Soviet Block.
Technologies is the main factor that leads to globalisation as there are some specific area
that makes easy for the countries in import and export of goods and services. For example,
Germany and England export product like chemical, electrical in developed nations.
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Factors of globalisation that influence the fashion industry both in positive and negative way.
According to the Cleveland, (2016) It is fact that fashion industry largely depends on
import and export of goods and services and globalisation changes the face to textile.
Globalisation leads to both positive and negative impact on all type of industries whether it is
retail, technology or fashion industry. Competition has increased to the great extend by rising of
trade across the boarders specially in fashion industry. Not only styles, patterns and fast
adaptation of fashionable clothes but the competition is increases in cost, price, adaptation of
technologies, fast response, target market and frequent product by organisations. The choice of
customers is also varied after globalisation as they have more options to move from one product
to another. Thus, competition leads to both positive and negative impact on the fashion industry.
Walter, (2017)said that, with the increasing trade across the boarders in fashion industry,
merger and joint ventures is also at the great heights. It allows accessing to bigger markets as
well as associated cost benefits. With the merger, it becomes easy for both the firms to raise the
market share and range of products in the market. The best advantage of merger is that it reduces
the threat of competition. For example, Puma, Only, Vero Moda etc. are merged with Iconic
Brand. These companies merged with Iconic brand in fashion industry in order to raise the
market share as well as to reduce competition as firm operates by making a good coordination.
As per the Owen and Quinn, (2016) The another factor that increasing trade across the
boarders in the fashion industry is that it raises the exchange of technology in the market. E-
commerce and internet procedures hold special potential for small and medium scale firms
seeking to broaden their involvement into new global market. Technologies improved the quality
of products and services in fashion industry like for sports wear there are good variations, colour
changing clothes, shoes and accessories, Woven in touch sensors to control a phone, socks with
pressure sensors, 3D printings etc. These new styles of clothes, shoes and accessories are only
with the help of advance technologies and it is possible only after globalisation.
Vivas-López and et.al., (2016) said that, with the globalisation, it discovers global talents
and this leads to positive impact on globalisation. The global business environment leads
designers in fashion industry to come into the spotlight. The level of competition is cut-through
in fashion industry because of the craze of fashion among people is very high and they are very
much concern about the fashion. On the other hand, negative impact of globalisation is that
multinational corporations are accused of social injustice, unfair working (including slave labour
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wage as well as poor living and working condition) along with lack of concern for the
environment, mismanagement of natural resources and ecological damage.
Challenges faced by Zara in selling goods and services across the boarders after globalisation.
According to Lund and Tyson, (2018) There are various challenged faced by Zara and
other retailers after globalisation like omni channel integration, employee productivity,
management of inventory and price transparency. These are the major challenged faced by retail
companies in the global business environment. It has been noticed that the productivity of
employee is an ongoing issue as well as most likely always will, it has started become a great
challenge in today's environment. Further more, another challenge which is very challenging for
company is the effective management of inventory but it is important. For example, Zara may be
lured by a higher margin offered in order to grab market share.
As per the Taglioni and Winkler, (2016) globalisation also leads to price transparency is
largely varied between the location of store that is based on average market price for the goods in
that region. It is very challenging for retailers and Zara to maintain the standard of price across
the board. In addition to this, some another common challenges are language barriers, difference
in currency, culture, region, etc. which become very difficult for the retailers to trade.
Strategies for business expansion
As per the findings of Dworkin, (2016) innovation is one the best method or strategy to
expand the business in the global world. Innovation in the product or services definitely raises
the market share of the company. Zara and other retailers should brings a new technology in the
market for customers for example, summer shoes, eco-friendly outwears, solar charged jacked,
shirt sleeved with mobile phone holder and many others. Technology innovation is not only in
machines and tolls but fashion industry is bringing technological innovations in clothing and
shoes in order to attract more customers. On the other hand, merger and acquisition, joint venture
is another way to expand the business in global business and to raise the market share. For
example, the merger of Armani and Zara by Peter Horrel to raise the market share and business
across the world. Thus, retailer and Zara should look on this as well as to make the business
more globally expand.
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RESEARCH METHODOLOGIES
Introduction
This is very important chapter of the research proposal as the entire study is depended on
the selection of research methodologies. So, with the help of selected research methods, scholar
can solve all the research question very effectively.
Research type
Before starting the research, it is very important to select the base of the study on which it
will depend. It is very essential to follow the systematic methods and techniques to conduct the
research. There are mainly two types of research on which the study will be based are
quantitative and qualitative. Investigation that is based on measurement or calculation of amount
or quantity is called as quantitative research (Quinlan and et.al., 2019). On the other hand,
investigation that is based on words, emotions, feeling is known to be qualitative research. This
present study will be based on qualitative research as views of respondents will be taken. Thus,
with the usage of qualitative method, scholar will effectively and efficiently identify the benefits
and drawbacks of a global business environment.
Research Approach
After the selection of the method it is also very important to plan the methods and
techniques for the collection, analysis and interpretation of data. There are mainly three types of
research approaches which are deductive, inductive and abductive. In this present research,
researcher will use deductive approach as it is best and suitable approach when research study is
based on qualitative method (Christ, 2017). Thus, with the usage of deductive approach,
researcher will effectively identify the benefits and drawbacks of a global business environment.
Research Design
It is the systematic and well-defined plan to study all the research question logically.
There is a very close relationship between research design and research methods but by default it
is different. It is very important for the scholar to select the best research design because it is
directly related because the answer of research question is depended on the research design.
There are two types of research design which are descriptive and conclusive. In this present
research, scholar will use descriptive research design in order to depict the participants in
accurate manner and it is best for qualitative research (Rigney, 2017). Thus, with the usage of
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descriptive research design, scholar will effectively identify the benefits and drawbacks of a
global business environment.
Sampling
Sampling is very important part of the research methodologies as well as in studying any
topic. It is the process of selecting a small part of the population. The group of individual is
called as population. It is fact that it is not possible to study the large population, thus in order to
make the study convenient and easy scholar select small part of the population. There are two
types of sampling which are probability sampling and non-probability sampling. In this present
research, scholar will use probability sampling as every respondents have equal chances to be
selected in the sample. Simple random technique will be used by researcher. Researcher will
select 15 senior managers of Zara as it is convenient to for researcher to study as well as small
sample reveals more authentic results (McCusker and Gunaydin, 2015).
Data Collection
Data collection is very essential part of the study. It is the process of gathering as well as
evaluating information on the interest of variables in a very systematic manner that enables to
solve the research question, test the hypothesis and measure the results. There are two method of
data collection which are primary and secondary. When research collect the data from his/her
own efforts or by own hand is called as primary data such as force group, interview, survey etc.
This type of data are more reliable because it is first hand or unused data. On the other hand,
when scholar collect the data from other sources like internet articles, blogs, books, journals etc.
are called as secondary data (Higginbottom and Liamputtong, 2015). These type of data are less
reliable and it is not fresh data. In this present report, researcher will use to collect data from
primary method by conducting survey.
Primary Research
It is the research which is conducted in order to collect first hand data and information for
given current problem. There is in-depth knowledge of this research as data is collected through
surveys, group discussion, questionnaire. Time required for such research is more and costly.
Secondary Research
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It is the research where data and information is collected through existing sources. This
includes books, magazine, internet, newspaper. It is less time consuming and less costly. The
decision making is quick in this research as data are taken from already existing source.
Ethics from Questionnaire
Ethics are defined as standards or norms required for conducting work which differentiate
among right and wrong. There are some principles which every researcher need to follow while
doing research such as human right, compliance with law, safety and others. The ethical
principles of research are: respect for person, communities, justice and others. It is very
important part to make research ethical and good.
Data Analysis
When the entire data for the study is collected than it becomes very essential to give the
meaning to the raw data. Without analysis of data, the information collected is meaningless and
useless (Kovach, 2015). There are two methods for data analysis which are qualitative and
quantitative methods. In this present research, scholar will analysis the data by using qualitative
methods where thematic analysis will be done. Data will be presented by table, graph and charts
will be prepare.
CONCLUSION
From the above proposal it is concluded that globalisation has both good and bad side in
the business environment. It leads to both positive and negative impact on all type of industries
whether it is retail, technology or fashion industry. The threat of competition has increased to the
great extend by rising of trade across the boarders specially in fashion industry. It was also
summarised that political, economical, technology, tax differences system and many other
factors leads to globalisation.
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REFERENCES
Books and Journals:
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pp.1-20.
Berenskoetter, F., 2017. Approaches to concept analysis. Millennium, 45(2), pp.151-173.
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(In Press).
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dispositions and behavior: A cross-national examination of globalization and culture
change. Journal of Business Research, 69(3), pp.1090-1102.
Dworkin, M.J., 2016. Recommendation for block cipher modes of operation: The CMAC mode
for authentication (No. Special Publication (NIST SP)-800-38B).
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interventionist methodologies. Cognition and Instruction, 34(3), pp.275-284.
Higginbottom, G. and Liamputtong, P. eds., 2015. Participatory qualitative research
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Kovach, M., 2015. Emerging from the margins: Indigenous methodologies. Research as
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Lund, S. and Tyson, L., 2018. Globalization Is Not in Retreat: Digital Technology and the Future
of Trade. Foreign Aff., 97, p.130.
McCusker, K. and Gunaydin, S., 2015. Research using qualitative, quantitative or mixed methods
and choice based on the research. Perfusion, 30(7), pp.537-542.
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Owen, E. and Quinn, D.P., 2016. Does economic globalization influence the US policy mood?: A
study of US public sentiment, 1956–2011. British Journal of Political Science, 46(1),
pp.95-125.
Psimmenos, I., 2018. Globalisation and employee participation. Routledge.
Quinlan, C., Babin, B., Carr, J. and Griffin, M., 2019. Business research methods. South Western
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Rigney, L.I., 2017. Indigenist research and aboriginal Australia. In Indigenous Peoples' Wisdom
and Power (pp. 61-77). Routledge.
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startup dynamics in mature manufacturing industries. Journal of the Knowledge
Economy, 7(4), pp.947-962.
Walter, S., 2017. Globalization and the demand-side of politics: How globalization shapes labor
market risk perceptions and policy preferences. Political Science Research and
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Wang, N., 2015. Globalisation as glocalisation in China: a new perspective. Third World
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Wright, S., 2016. Language policy and language planning: From nationalism to globalisation.
Springer.
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