zara essay - 3760 Words

After Zaras first Australian store in Sydney reportedly sold out 80% of its stock (worth $1.2 million) in its opening day in 2011, sales figures in 2014 have revealed slowing sales momentum and increasing costs. Using the Resource-Based View of the firm (RBV) (Barney, 1986, 1991), critically evaluate the competitiveness of Zara within the Australian retail industry. The resource based view revolves around the notion of a firms tangible and intangible resources and capabilities allowing the firm to sustain a competitive advantage amongst its competitors. Zara being one of the biggest multinational fashion retailers of our time possesses many resources that enable Zara to maintain a competitive edge. Zara’s most noteworthy tangible†¦show more content†¦Secondly resources have to provide a unique strategy in order to be deemed rare as well as be limited in supply. Adding to this, the resource must be inimitable (reference). Meaning the resource itself must not be easy to duplicate, as competitors could quickly copy them, dissipating all potential for sustaining a competitive advantage (Cardeal Antonio, 2012). Aforementioned the rapid response of trends to stores is a resource deemed rare and hard to imitate relying on other resources such as Zara’s just in time management system and enabling vertical management within the co mpany. Lastly, a resource needs to be non-substitutable, suggesting that a resource cannot simply be replaced by another one, creating a competitive barrier (Lockett, Thompson, Morgenstern, 2009). Again the fast fashion concept utilized by Zara is unable to replace by another strategy and still remain as efficient. (ADD MORE). A company needs to care for and protect the resources possessing these above characteristics, and Zara does this by constantly maintaining and updating internal systems and processes. The VRIN characteristics are all individually necessary to develop and sustain competitive advantage, but each characteristic on its own is insufficient. (Priem Butler, 2001) Source: Boundless. â€Å"The Resource-Based View.† Boundless Management. Boundless, 08 Dec. 2014. Retrieved 03 May. 2015 fromShow MoreRelatedEssay on The Zara Business Model2190 Words   |  9 PagesIntroduction Zara is the most popular and profitable brand of Inditex SA, the world’s largest retail group. The first Zara store was launched in 1975 in La Coruà ±a, Spain; a city which eventually became the central headquarters for Zara’s global operations. In the beginning the store was named Zobra, but after a while the founder and CEO Amansio Ortega has renamed it to ZARA. The first international Zara store was opened in 1988 in Oporto, Portugal. Since then Zara has expanded its operations intoRead MorePorters Analysis of Zara Essay1934 Words   |  8 Pagesrelevant literature. 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