PESTLE ANALYSIS ON ZARA

 

          When it comes to fast fashion brands, Zara is the first brand that comes to mind. Zara is a retail, fast-fashion brand founded in 1975 in Spain by Amancio Ortega and Rosalia Mera. It is a multinational clothing brand that specializes in selling clothing, shoes, accessories, perfumes, and beauty products. Zara has more than ten thousand stores worldwide.

PESTLE analysis of the brand analysis business tactics and various external factors directly or indirectly impact the business.

1. The Political Factor

Zara is linked to the European Union and has a well-established framework of trade which allows the import and export of raw materials and finished products respectively.  As the European Union is the UK's largest export market for textiles and clothing, it helps Zara export its products all across the world at a low cost and with little effort. 74% of the exports of the European Union are made by Zara alone, which helps it boost its sales. A significant factor affecting the market is political disruption, which affects the economy and supply chain. Zara overcame all these by restricting its supply chain within its country and neighbouring countries.

2. The Economic Factors

Zara is a Spanish brand, and Spain has the highest unemployment rate, which eventually results in a low cost of labour. This is a positive sign for the brand. Zara is a well-known brand, so those who are not familiar with it might think that it is expensive, but on the contrary, it is affordable compared to other European fashion brands. This helps it to bloom even in poorer countries.

3. The Sociological Factors 

Due to its hard work, Zara is a fashionable brand for most people. Its strong brand presence allows it to collect huge profits for its shareholders, all because of its marketing strategy of providing good quality at affordable rates. 

4. The Technological Factors

These days, when online shopping is booming and people are looking to buy products without leaving their houses and with just a touch of a button, Zara has a solution for it; they have a well-designed website that boosts their online presence. Zara researches to know about their customers and works on it to increase their sales.

5. The Legal Factors

Zara is a brand that operates in multiple countries, so its business ought to be affected by the laws of the countries and areas. Zara has to run within the boundaries of the law, and one of the most terrifying is copyright law. Zara provides the hottest clothing at an affordable rate, which causes them to run into some copyright issues. Zara has some of these issues, but they were able to move out of these uncomfortable legal situations. Who knows if their good luck will continue?

6. The Environmental Factors

Zara is considered a fast-fashion brand and might be associated with wastefulness. As the population is more conserved towards the environment, this can have a negative effect on the brand, which can be overcome if they turn towards sustainability. The brand shares its commitment to water, climate change and energy, biodiversity, sustainable materials and other environmental issues in depth on its website. It will continue to thrive if they follow these guidelines.

Overall, Zara has a solid business plan. If they consider the factors that negatively impact them, their business will undoubtedly be successful in all terms.