HND Business Unit 17: Zara and Canifa's Response to Change

This report delves into the business strategies and adaptations of Zara and Canifa, examining their responses to changing market dynamics, particularly the impact of the COVID-19 pandemic. The report begins with an introduction to both companies, providing background information on their founding, vision, mission, core values, and financial performance. It then proceeds with a detailed PESTEL and SWOT analysis of Zara, evaluating the political, economic, social, technological, and environmental factors influencing its operations, as well as its strengths, weaknesses, opportunities, and threats. The analysis of Canifa, though less detailed, provides insights into its strategies and challenges. The report further explores how both companies have adapted to changes, including those brought about by the pandemic, and evaluates the effects on leadership, team, and individual behaviors. Finally, the report offers recommendations and a conclusion summarizing the key findings and implications of the analysis.

ASSIGNMENT 1 FRONT SHEET
Qualification BTEC Level 5HND Diploma in Business
Unit number and title Unit 17: Understanding and Leading change
Submission date Date Received 1st submission
Re-submission Date Date Received 2nd submission
Student Name Trần Minh Nghĩa Student ID GCH18784
Class GBH0901 Assessor name Vũ Anh Tài
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I certify that the assignment submission is entirely my own work and I fully understand the consequences of plagiarism. I understand that
making a false declaration is a form of malpractice.
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Table of Contents
INTRODUCTION.................................................................................................................................4
A: ABUOUT ZARA AND CANIFI........................................................................................................4
B: PESTEL & SWOT ANALYSIS.........................................................................................................5
C: COMPANY CHANGES UNDER COVID'S INFLUENCE............................................................................16
D: AN EVALUATION OF HOW RELATED DRIVERS OF CHANGE AFFECT LEADERSHIP, TEAM, INDIVIDUAL
BEHAVIORS AND THEIR RESPONSES TO CHANGE AS WELL AS LONG TERM IMPACTS IN THE TWO CASES
...........................................................................................................................................................18
E: RECOMMENDATIONS......................................................................................................................19
F: CONCLUSION...................................................................................................................................19
REFERENCES........................................................................................................................................20

INTRODUCTION
Today we are constantly changing to adapt to the environment we live in, with everything around us. for
businesses too , a business needs to change continuously to develop , this is considered as a top task that
cannot be ignored . The following report will clearly show the changes to develop the business, through
the analysis of two companies, zara and canifa.
A: ABUOUT ZARA AND CANIFI
1: ZARA
Zara is a fashion and accessories brand belonging to the Spanish group Inditex. Zara was founded in 1975
by Amancio Ortega and Rosalia Mera. Ortega previously established an Inditex dress factory in 1963.
Today, Zara has nearly 6,500 stores in 88 countries worldwide. Zara is one of the eco-friendly companies.
It uses solar panels and wind turbines at its headquarters in La Coruna. Zara is also known as one of the
few brands that produce 100% cruelty-free clothing. (Bac, 2021)
Vision: Zara's vision: “to contribute to the sustainable development of society and that of the environment
with which we interact.”
Mission: Zara's mission : “give customers what they want, and get it to them faster than anyone else.”
Core values: Zara's core values : “beauty, clarity, functionality, and sustainability.” The company uses
these as the purpose to development
In 2019, The company ITX possesses the Zara chain of stores, said net benefit for the period was 1.55
billion euros, compared with €1.41 billion a year prior. Deals rose 7% to €12.82 billion, made a difference
by development in all brands and districts, the company said. On a like-for-like premise, deals developed
5%. Net edge for the primary half was 56.8%, compared with 56.7% the year past. The company said
store and online deals rose 8% between Aug. 1 and Sept. 8 in neighborhood monetary standards. and
gauges that LFL deals will develop by 4% to 6% in its full-year 2019.( Olivia, 2019). It can be seen that
some time recently the 19 covid plague around the world, zara's commerce prospered.
Zara suppose the pandemic effected strongly deals within the to begin with quarter. But indeed some time
recently Covid-19 closed retail outlets around the world, Zara and others had confronted increased
challenges keeping up deals development force and competing with online-only attire retailers. To be

particular, first-quarter deals dropped 44% to €3.3 billion from a year prior, more extreme than
investigators anticipated. The company swung to a misfortune of €409 million from a year-earlier benefit
of €736 million. That included a €308 million charge to shut and restore stores. In any case, capital has
budgetary potential whereas offers of the bunch still keep up a steady fascination on the stock trades,
Inditex does not deliver workers take off and still pays representatives amid the emergency due to
widespread. Zara moreover said deals in later weeks were making strides relentlessly as stores closed by
the widespread revive.(Saabira, 2020)
2: CANIFA
Canifa may be a clothing brands from Viet Nam which know for create a normal and formal cloths and
extras for center lesson individuals which cost from two hundred thousand dong to one million dong. In
expansion Canifa moreover hit a expansive sum of costumer since their items are changes for man ,ladies
and children.
The Canifa’s vision : “ Hoang Duong Company wishes to gotten to be an organization to enhance and
succeed, client believe, participation within the organization pleased and social recognition’’
The Canifa’s core values are Respect – Creation – Honesty- Sharing. ( Canifa, 2021)
With the strategy of extending its arrange, from the primary 2 stores in Hanoi within the early 2000s,
Canifa presently has around 100 stores in 24 territories and cities across the country. Some time recently
being impacted by covid, in 2018, Canifa recorded a record income of 931 billion VND, 2.4 times higher
than the figure accomplished the past year.( Thanh, 2019)
The canifa company has been intensely impacted by the Covid-19 episode. The disturbance of the supply
chain of crude materials, the closure of the moment markets due to the usage of social barricades to avoid
scourges, the diminishing request for items are the challenges that Canifa faces.
B: PESTEL & SWOT ANALYSIS
1:ZARA
The unconventional mix of local fabricating, agile coordinations and forceful grasp of ecommerce has
made a difference Zara weather the aftermath from the worldwide lockdown superior than numerous other
retailers. It’s moreover made a difference recalibrate operations for a future . In Zara PESTLE & SWOT

investigation, we are planning to take a closer see at this way of life and retail brand, and how its future
may be influenced by Covid 19.
1.1: PESTEL
a,Political
Zara is a Spanish brand, so it appreciates all of the benefits of working a commerce out of the European
Union. In other words, it falls beneath the ambit of the European Union and appreciates the benefits of
free exchange understandings and tax-concessions that have gotten to be the trademark of the EU
commerce scene. In a political setting, one of the biggest aces of running a company within the EU is the
country’s broad exchange assentions. Not as it were does this make it inconceivably simple to purport
crude materials and trade wrapped up items inside the European Union, but it too implies that Zara can
send its stock over the world with small exertion and for a moo taken a toll. Generally, the EU’s free-trade
approaches are enormously useful for Zara.
b,Economic
Some time recently the 19 covid pandemic, the victory of Zara is profoundly tied with the financial status
of the domains it works in. For illustration, being essentially a Spanish brand, Zara can utilize the low-cost
labor that's effortlessly accessible in Spain. This allows them to preserve benefit additionally give its
followers with reasonable mold.
Well known attire brand Zara's Spanish has closed down 3,785 stores around the world in the midst of the
COVID-19 flare-up. Inditex cautioned that its operations have confronted a 'very noteworthy impact' due
to the widespread. It said it has been constrained to closed down in 39 markets, concurring to a report by
Metro. To be particular, Deals took a hit by 24.1% activated by the closure of stores within the to begin
with two weeks of Walk. The company might book a arrangement of 287 million euros as its
spring/summer stock loses its esteem due to the coronavirus episode. Inditex delayed its choice on paying
out a profit till afterward this year. Additionally, Inditex's biggest organize of stores is in Spain, but the
company has shut all stores within the nation due to a nation-wide lockdown by the Spanish government
on Saturday.( BTeconomy, 2019)
The Covid-19 flare-up has incited Zara to reply through diverse activities and programs in arrange to
handle the wellbeing and financial results of the widespread on supply chain laborers and trade

communities. Firstly, at the onset of the widespread, Zara enacted a worldwide crisis help program inside
community speculation exertion to which Zara have given over €36 million. That exertion empowered
Zara to convey 155 million units of individual defensive hardware and other necessities to where they
were critically required. To be particular, in Spain Zara made the company’s full coordinations and
obtainment capabilities accessible to the wellbeing administrations and benefactor businesses and people
for the buy and transportation of wellbeing hardware. Furthermore, when the store stock sat sit still within
the lockdown, Inditex depended on volunteer laborers to go choose up the pieces of clothing. Amid the
widespread, online had an opportunity to sparkle since in most major nations where Zara works in Europe,
ecommerce was permitted to proceed working indeed as bricks-and-mortar incidentally closed down. This
happened in Spain, Inditex’s biggest advertise, where the government pronounced a national lockdown
Walk 14, causing retail deals to drop by a record 14% that month.
The company remains in great shape, much appreciated to its solid adjust sheet bragging 8 billion euros
($9.04 billion) of cash and cash reciprocals, the coordinates online commerce and moo stock compared
with rivals. (Inditex, 2020)
c, Social
One of the driving causes behind the around the world acknowledgment of Zara is elegant brand and the
capacity of the organization to viably inquire about the social social subtleties of its target advertise.
Firstly, Zara may be a fashionable title for most shoppers. This is often where you'll be able as it were
commend the company for its difficult work. Zara conveys a good-quality item for not a parcel of cash.
Hence, this solid, positive brand nearness permits Zara to gather solid benefit edges for its shareholders,
whereas buyers still feel like they’re getting a incredible bargain. Secondly, Zara did showcase inquire
about when needing to enter Vietnam. Prices and models in Vietnamese items have contrasts compared to
other markets to meet the requirements of Vietnamese individuals. This permits the company to supply
design that's promptly satisfactory by its target statistic, conjointly at costs that they can manage. Along
with this, Zara’s imaginative promoting tropes allow its shoppers a feeling of restrictiveness which they
fair can’t bear to miss.
d, Technology
Technology incorporates a huge part to play within the victory of Zara, permitting Zara to arrange what
has been sold or what they know will be sold, due to bits of knowledge on request. Zara knows that they

have to be utilize computer program that targets the focuses in its esteem chain where it'll have the
foremost noteworthy affect. As one of the world’s most well known design retailers, the company has
both the cash and the gathering of people required to induce the foremost out of information. As a result,
Zara is looking to huge information — the study of analyzing tremendous information sets — to find
better ways to reach and offer to shoppers. With both online and in-person client touchpoints, this isn’t a
clear errand. The computer program must get it all the parts of the framework in arrange to supply precise
plans, based on genuine request, instead of speculating and estimating from deluding verifiable
information. Technology that makes a difference Zara recognize and fabricate the dress clients need, get
those items to advertise rapidly, and kill costs related to promoting, stock slips, and markdowns. When
Zara confronted covid19, Zara connected innovation in requesting and conveying products.( Laura, n.d)
e, Environmental
For environmental factors, Zara is confronting 2 issues. The primary issue is the allegation of a squander
of quick design. Numerous quick mold items basically aren’t outlined to final; instead, they’re assumed to
be reasonable garments that see great within the changing rooms. What’s more, quick mold is said to
energize customers to rapidly bounce on patterns, tossing absent clothing fair to stay with whatever is hot.
With customers getting to be increasingly eco-conscious, this seem have a negative effect on the brand on
the off chance that it doesn’t start to require supportability more truly. The moment issue is supportability
vow. Zara’s parent brand Inditex has transparently distributed a maintainability vow. On its site, the brand
offers its “commitment” to water, climate alter and vitality, biodiversity, economical materials, creature
welfare, and other natural and moral issues in profundity.
f, Legal
A company cannot work in vacuum and must comply with the lawful structure of the territory it works in.
Zara too isn't an exemption. It needs to be beyond any doubt the legitimate consequences of its operations
and make beyond any doubt that compliance rules are viably taken after. Zara must comply with the laws
of labor laws, supply chain working and trademark & copyright in arrange to flourish. n truth, the major
retailer as of now has. It’s been denounced of taking plans and clothing concepts from the likes of Adidas
and Balenciaga. In past cases, Zara has generally been able to weave itself out of awkward legitimate
circumstances like these, but who knows on the off chance that the behemoth brand will proceed to have
such great good fortune.

1.2: SWOT
Strength:
leading advantage
strong supply and retail system
adapt to online sales very quickly
Weakness
must depend on the store
the risk of taking great risks when starting IA
technology
have not captured market share in major markets
thi
Opportunity
Fast delivery
environmental Protection
Personalized
Threat
Covid pandemic
law and government
competitor
a, Strength
Firstly, Zara’s quick fashion model and its shocking victory is routinely talked around as relevant
examinations in critical commerce foundations. The plan brand has gotten an curiously demonstrate and
moreover found a novel concordance among ask and supply. Since fast-fashion centers on planning,
creating, and offering dress as before long as they distinguish a drift. So Zara clients will continuously
discover unused dress on the racks. This invigorates client shopping. Zara is able to bring a few mold
cycles with the assistance of a profoundly coordinates supply chain and a exceedingly talented group of
fashion designers. Furthermore, Zara encompasses a add up to of 2249 stores and has become the brand
with the biggest number of mold retail stores within the world. The number is nearly twice the number of
retail stores than Nike has, which has the second-highest number of retail stores. Besides, zara revives its
online and retail collection two times a week. Zara’s 10 calculated centers convey to any area within the
world inside 48 hours. Inditex too has an in-house group who plan program to twofold the speed at which
the company dispatches orders. Thirdly, when the covid widespread happened, Zara rapidly contributed
$3 billion in reinforcing its online deals. The speculation centers on creating an locks in online buying
encounter and joining existing physical foundation. The coronavirus has quickened the slant towards
online shopping, which was as of now disturbing the retail industry and battering major chains some time

recently the widespread hit. Inditex said that online deals bounced 95% in April from the same month
final year, and were up 50% within the to begin with quarter of its monetary year. The company points to
create a quarter of its income through online deals by 2022. (Hanna, 2020)
b,Weakness
Firstly, the pandemic quickened Zara’s plans to restrain the number of physical stores. Online deals made
a difference Zara climb out of a gigantic drop in deals since of COVID-19-related causes. Be that as it
may, indeed with online deals picking up, the deals are as it were at 89% of what it was in 2019. Besides,
Inditex is working with AI and Huge Information companies to form an AI-enabled framework that
predicts customer behavior. In any case, the current framework is still in its testing arrange. When such a
framework goes online, Zara will have the unrivaled capability in foreseeing and satisfying customer’s
needs. Thirdly, in a few of the quick developing markets counting US, India and Malaysia, the number of
ZARA stores is low. Zara has 99 stores within the US. This accounts for as it were 4.4% of Zara’s 2249
stores. Be that as it may, the US is the greatest attire advertise within the world. Number of ZARA stores
in India is fair 20 (Jan, 2018), Malaysia 10, Thailand 11 and Newzealand has just one store. Usually much
less compared to the number of ZARA stores in USA, UK, China, Russia, Spain or a few more European
and American countries. India is an appealing advertise for mold brands where extending ZARA’s retail
nearness would be beneficial. (Abhijeet, 2019)
c, Opportunity
This advantage puts Zara within the right put to use opportunities on the skyline. The primary is fast
Conveyance Cycle. Clients visit Zara’s shops on an average of 17 times a year. This can be since Zara
reacts to patterns as before long as they develop. Right presently, Zara delivers a drift from begin to wrap
up in fair 2 to 3 weeks. Be that as it may, within the future, Zara may abbreviate the cycles indeed more.
The moment is rersonalization. Collecting information and sectioning the client base after analyzing the
information is getting to be less demanding than ever some time recently much obliged to AI. This permits
for giving personalized proposals to clients. Zara ought to capitalize on this technology. The third is eco-
Friendliness: Concurring to the Sourcing Common, more than 1/3rd of Millennials and Gen Z hunt for
“sustainable” and “environment friendly” names on dress. Together, the two bunches account for 50% of
the populace. So, Zara must tune in and react to this developing require(Catherine, 2020)
f,Threat

The primary is COVID-19. Within the to begin with quarter of 2020, Inditex detailed a 44% drop in deals.
Inditex’s report states the closure of 88% of its stores since of the Coronavirus lead as the central reason
for the drop in deals. The moment is government directions. Zara has 13 industrial facilities in Spain. Due
to the Spanish government’s lockdown measures, only 3 of the 13 industrial facilities worked within the
early months of the widespread. With Europe heading towards a moment wave, the company can
anticipate comparative measures. The third is competition. Zara’s greatest competition within the
conventional sense would be H&M.
2, CANIFA
2.1: PESTEL
a,Political
Vietnam is receiving a blended economy and government still plays a enormous part in arranging and
overseeing. The endorsed official archives of the 11th National Party Congress clearly stipulate that
Vietnam proceeds to apply the showcase economy with communist introduction, and the State Possessed
Endeavors (SOEs) still play the unequivocal parts of Vietnam’ economy. In this manner, Vietnam as of
now includes a moderately total customer assurance lawful framework such as endorsing authoritative
infringement in commercial exercises, fabricating and exchanging fake products, ensuring consumers'
interface. For illustration, All items and administrations utilized with the purposes of generation,
exchanging, and utilization are subjected to Esteem Included Assess (VAT) in Vietnam. Imported
products are required to pay not as it were VAT but too purport obligations to the traditions specialists.
(PwC Vietnam, 2019).
For a commerce such as Canifa fashion, to create a advertise, it must be touchy to the topographical
circumstance of the locale and figure Vietnam's political advancements to create suitable and opportune
techniques. To entirety up, the political circumstance with the firmly controlled legitimate framework is in
line with Canifa's advancement
b,Economic
After the application of a modern arrangement of political and economic changes, Vietnam has changed
altogether in all angles. From 2002 to 2018, 45 million individuals were lifted from destitution. The extent

of national destitution diminished from more than 70% to beneath 6%. Net Residential Item (GDP) per
capita developed 2.5 times more grounded, recording at 2500 USD in 2018. (World Bank, 2019).
Agreeing to a think about by Statistics Portal - a German showcase investigate company, estimates that the
yearly development rate (CAGR) of Vietnamese design within the period 2017-2022 is 22.5%. Much
obliged to this development, the advertise might reach 988 million USD in income by 2022. Vietnam
keeps up a steady and tall financial development (7% in normal for the last decade). This is often greatly
appropriate for Canifa to abuse and develop. (Anh, 2019)
The coronavirus episode happened all of a sudden and quickly spread wildly all over the world. Vietnam
was one of the nations enduring from this worldwide plague. In arrange to halt the spreading of
coronavirus, the Vietnamese government ceased to allow visa to all outside citizens (Vu 2020).
Furthermore, the specialists moreover put a number of primary roads beneath transitory lockdown and
commanded businesses to shut early (Le 2020). Individuals were prompted to remain at home and
maintain a strategic distance from attending to open and swarmed places. Schools were closed and
numerous workers were required to work from domestic or indeed laid off. As a result, the widespread
incredibly influenced the execution of the Vietnamese economy in specific and the worldwide economy as
a entire. Intensely injured businesses included materials, footwear, flying, and innovation (Vietnam
Financial Times 2020).
To overcome the impacts of Covid 19, canifa turned to online deals. Canifa's online deals were up 300%
amid the stature of the widespread( Cafef, 2012). In expansion, Canifa, one of the biggest design stores
within the nation, has created 100,000 veils and sold 10,000 antibacterial texture covers since the starting
of February in Hanoi. Already, veils were not well known items of Canifa, the company as it were created
an greatly little amount of covers for its stores. In the midst of the flare-up of COVID-19, the company
confronted a challenge since of a gigantic drop within the number of clients. This modern improvement is
anticipated to mostly offer assistance Canifa survive through troublesome times.( Bich, 2020)
c,Social
Concurring to Countrymeters (2020), Vietnam has an nearly rise to proportion of men and wome in its
populace, with the male populace at 49.4% and the female populace at 50.6%. The rate of individuals
beneath 15 a long time ancient is 25.2%, whereas the extent of individuals over 65 a long time ancient is
fair 5.5%. A such, the populace from 15 to 64 a long time ancient takes up to 69.3%. Besides, Vietnam is