Zara once again draws from its strategic choices by some commercial advantage over its competitors. The "price mix" of Zara is therefore consistently throughout the first ambition of the firm which is, to democratize luxury apparel - and are inspired largely - to create models that will be sold half as much as the originals. Zara turns the "must have" for fashion houses to pieces affordable for all budgets and thus contributes to the popularization of fashion. Zara then moves to the "fair" price segment, more expensive than some competitors like H & M and Mango, but much more affordable than the big brands which inspire its collections. We will preserve a price level to address the many strategic choices that may seem surprising that Zara at first ultimately prove itself as effective.
The explanatory primary benefit of the efficiency of the pricing policy is followed by Zara, and its centralized production. Indeed it is from La Coruna (Spain) as Zara designs, produces and ships almost all (there are some other plants in Spain and Tunisia) of its products. Unlike its competitors, Zara has opted not to relocate its production to Asia and the costs of labor are the lowest. A surprising choice when the objective is to limit costs, but Zara compensates the higher wages by transportation costs that are much lower, even more advantage is reinforced when one knows the rate at which collections are changed.
Tags - Zara, Price policies, fashion
[...] Zara and its price policy Zara once again draws from its strategic choices by some commercial advantage over its competitors. The "price mix" of Zara is therefore consistently throughout the first ambition of the firm which is, to democratize luxury apparel - and are inspired largely - to create models that will be sold half as much as the originals. Zara turns the "must have" for fashion houses to pieces affordable for all budgets and thus contributes to the popularization of fashion. [...]
[...] Madonna or K. Lagerfeld for H & campaigns for TV or display, Zara does not communicate very rarely (only for a local announce the beginning of such sales). The budget share devoted to communication does not exceed of sales. With these two significant strategic choices (centralized and local communication and reduced), Zara manages to combine the products that follow trends and respectable qualities with relatively affordable prices for consumers. These strategic competitive advantages, then add as competitive advantages trading the level of charges made by Zara and it happens to be one of the pillars of its success. [...]
[...] Unlike its competitors, Zara has opted not to relocate its production to Asia and the costs of labor are the lowest. A surprising choice when the objective is to limit costs, but Zara compensates the higher wages by transportation costs that are much lower, even more advantage is reinforced when one knows the rate at which collections are changed. Another element to qualify the higher production costs, are collections in small quantities that can avoid the cost of unsold inventory which can be unnecessary. [...]
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