Zara

**Zara SA,** stylized as **ZARA,** (Spanish: [ˈθaɾa]) is a Spanish apparel retailer based in Arteixo (A Coruña) in Galicia (Spain). The company specializes in fast fashion, and products include clothing, accessories, shoes, swimwear, beauty, and perfumes. It is the largest company in the Inditex group, the world's largest apparel retailer. Zara as of 2017 manages up to 20 clothing collections a year.

## History

### Early history

Amancio Ortega opened the first Zara store in 1975 in central A Coruña, Galicia, Spain. Ortega initially named the store *Zorba* after the classic film *Zorba the Greek*, but after learning there was a bar with the same name two blocks away, they rearranged the letters molded for the sign to "Zara". It is believed extra "a" came from an additional set of letters that had been made for the company. The first store featured low-priced lookalike products of popular, higher-end clothing fashions. Ortega opened additional stores throughout Spain. During the 1980s, Ortega changed the design, manufacturing, and distribution process to reduce lead times and react to new trends in a quicker way, which he called "instant fashions". The improvements included the use of information technologies and using groups of designers instead of individuals.

### Expansion

In 1985, Amancio Ortega set up a parent company for Zara before going for the global expansion, and in 1988, the company started its international expansion through Porto, Portugal. In 1989, it entered the United States, and then France in 1990. During the 1990s, Zara expanded to Mexico (1992), Greece, Belgium and Sweden (1993). In the early 2000s, Zara opened its first stores in Brazil (2000); Japan and Singapore (2002); Russia and Malaysia (2003), China, Morocco, Estonia, Hungary and Romania (2004); the Philippines, Costa Rica and Indonesia (2005); South Korea (2008); India (2010); Taiwan, South Africa and Australia (2011).

In September 2010, Zara launched its online boutique. The website began in Spain, the UK, Portugal, Italy, Germany and France. In November that same year, Zara Online extended the service to five more countries: Austria, Ireland, the Netherlands, Belgium and Luxembourg. Online stores began operating in the United States in 2011, Russia and Canada in 2013, Mexico in 2014, South Korea in 2014, Romania in 2016, India in 2017 and Brazil in 2019.

Zara introduced the use of RFID technology in its stores in 2014. The RFID chips are located in the security tags which are removed from clothing when it is purchased and can be reused. The chip allows the company to quickly take an inventory by detecting radio signals from the RFID tags. When an item is sold, the stockroom is immediately notified so that the item can be replaced. An item that is not on the shelf can easily be found with the RFID tag.

In 2015, Zara was ranked 30 on Interbrand's list of best global brands.

In 2019, Zara had updated the logo.

In 2019 the Global Fashion Business Journal stated that while the textile commerce of the world had gone down by 2.38%, Zara had risen 2.17%.

In 2019, Chief Executive Persson said the brand is waiting for more acceptable global rent levels to continue their expansion. In Europe, the brand will be cutting the number of locations the next year.

## Products

Zara stores have men's and women's clothing as well as children's clothing (Zara Kids). Zara Home designs are located in European stores. Zara's products are supplied based on consumer trends. Its highly responsive supply chain ships new products to stores twice a week. After products are designed, they take ten to fifteen days to reach the stores. All of the clothing is processed through the distribution center in Spain. New items are inspected, sorted, tagged, and loaded into trucks. In most cases, the clothing is delivered within 48 hours. Zara produces over 450 million items per year.

## Manufacturing and distribution

Reportedly, Zara needs just one week to develop a new product and get it to stores, compared to the six-month industry average, and makes roughly 40,000 designs of which around 12,000 new designs are carefully selected and produced each year. Zara has a policy of zero advertising; the company preferred to invest a percentage of revenues in opening new stores instead.

Zara set up its own factory in La Coruña (a city known for its textile industry) in 1980 and upgraded to reverse milk-run-type production and distribution facilities in 1990. This approach, designed by Toyota Motor Corp., was called the just-in-time (JIT) system. It enabled the company to establish a business model that allows self-containment throughout the stages of materials, manufacture, product completion, and distribution to stores worldwide within just a few days.

Most of the products Zara sells are manufactured in proximity countries like Spain, Portugal, Turkey and Morocco. While some competitors outsource all production to Asia, Zara manufactures its most fashionable items – half of all its merchandise – at a dozen company-owned factories in Spain and Portugal and Turkey, particularly in Galicia and northern Portugal and Turkey. Clothes with a longer shelf life, such as basic T-shirts, are outsourced to low-cost suppliers, mainly in Asia.

The company can design a new product and have finished goods in its stores in four to five weeks; it can modify existing items in as little as two weeks. Shortening the product life cycle means greater success in meeting consumer preferences. If a design does not sell well within a week, it is withdrawn from shops, further orders are cancelled and a new design is pursued. Zara monitors customers' fashion changes. Zara has a range of basic designs that are carried over from year to year, but some fashion-forward designs can stay on the shelves less than four weeks, which encourages Zara fans to make repeat visits. An average high-street store in Spain expects customers to visit three times a year. That goes up to 17 times for Zara.

As a result of increasing competitive pressures from the online shopping market, Zara is shifting its focus onto online as well, and will consequently open fewer but larger stores in the future.

### Non-toxic clothing

In 2011, Greenpeace started a dialog with Zara to ban toxics from the clothing production. Greenpeace published its "Toxic threads: the big fashion stitch-up" report in November 2012 as part of its Detox Campaign identifying companies that use toxic substances in their manufacturing processes. Nine days after the report was published, Zara committed to eradicating all releases of hazardous chemicals throughout its entire supply chain and products by 2020. Zara became the biggest retailer in the world to raise awareness for the Detox Campaign, and switched to a fully toxic-free production.

### Exploitation and child labor

In 2016, BBC News stated they found evidence of child labor and exploitation in factories in Turkey. Zara replied that there were some issues in June 2016 in one single factory and - instead of solving these 'issues' immediately, they have given a period of six months to solve them.