Grupo Inditex Case Study

GRUPO INDITEX

Grupo Inditex, Industrias de DiseÐ*?o Textil, is one of the largest fashion groups in the world. It consists of eight units associated with the business of textile design, manufacturing and distribution. Grupo Inditex is present in 68 countries with 3.559 stores and is famous for its uniqueness and ability to adapt to changing environment; therefore we decided it would be appealing to explore the information about this particular group and find out what is the key to its success. Another factor that greatly affected our decision was simply the nature of the group which is fashion and textiles. Every woman would like get familiar with the stores that she spends most of her time in…

Even though Grupo Inditex is a Spanish group it has a chain of stores in 68 countries (see appendix 1) which indicates the greatness of its accomplishment.

With its exceptional management model that focuses on flexibility and innovation the company managed to gain a competitive advantage over its competitors. The unique combination of creativity and rapid response to the customers’ needs is one of the main characteristics of the group and has a great influence on its success. What is worth mentioning, in 2006 the group won Wharton Infosys Business Transformation Award for implementing an information system that allowed it to decrease the time of introducing new assortment to the stores.

Inditex was founded in 1975 by Amancio Ortega Gaona who is still the chairman of the group. Presently it employs over 70.000 employees and generates revenue reaching €8.169. The headquarters are located in Arteixo, the province of La CoruÐ*?a, the northern part of Spain.

The existence of Inditex started with the opening of first Zara store in 1975 in La CoruÐ*?a, which as we mentioned before still remains the home for all central offices. Zara’s store can now be found in most important shopping districts in over 400 cities. After it has succeeded in the domestic market, the Inditex group was created and first store outside Spain opened. One year later, in 1989 the group set up its operations in USA and France. Few years later the group acquired Massimo Dutti and introduces Pull and Bear and then Bershka to the market. In 1999 purchase of Stradivarius took place and launch of Oysho and Kiddy’s Class. Over this time the group has managed to enter the international market which we will discuss later on.

As stated above Inditex employs over 70.000 professionals. Majority of that number account for woman, 82.8% and youngsters with the average age of 26. Inditex has a very strong corporate culture. Its operations are based on teamwork and focused on open communication. The great emphasis is given to personnel’s commitment to the company. For this reason, the group provides its employees with job stability, training and opportunities for internal promotions. All members of staff are guaranteed dynamic and international environment with plenty of space for their own ideas. Inditex is known for its good customer service and quick response to high level of demand.

Grupo Inditex cares about its employees; therefore it adapts policies that comply with government’s regulations and protect their rights. It does not employ under aged, does not permit any kinds of harassment or discrimination. Distribution of salaries is based on function performed. And what is important, the personnel perform their functions in a safe and healthy environment. All these aspects result in perception of Inditex as a good employer.

In order to explore Grupo Inditex we need to take a closer look at all of its components, which are: Zara, Pull and Bear, Massimo Dutti, Bershka, Stradivarius, Oysho, Zara Home and Kiddy’s Class.

Zara is Inditex’s best known brand with network of 1.109 stores in major cities and 80% of group’s revenue. Its main advantage is that this Spanish firm not only sells clothes but also designs and makes them in an incredibly short period of time, only 2-3 weeks. Zara is often described as “possibly the most innovative and devastating retailer in the world” (LVMH fashion director Daniel Piette). Its genius lies in wide range of clothes that are being constantly updated and delivered to the stores twice a weak. Such a strategy allows the company to react to changes in trends.

Second brand of the group is Pull and Bear with 489 shops in 35 countries. The main segment of the market the company targets is young people, therefore it manufactures clothing and accessories in a casual, laid-back style.

Another component of Inditex is Massimo Dutti which was acquired entirely by the group in 1995. The firm runs its operations through 421 stores situated in 32 countries. Company’s basic objective is to serve the independent, urban and cosmopolitan sector. As a result, Massimo Dutti provides practical, comfortable and high quality assortment that combines classic and current styles. This particular brand is perceived as sophisticated due to its great emphasis to customer service.

One of the most avant-garde companies of the group is, created in 1998, Bershka. It aims at young people with sociocultural fascinations. Bershka represents a very specific concept of a store design with special spots to watch videos, listen to music or read magazines. “They are intended to be meeting points for street fashion, music and art”. Since its launch in 1998, the company has set up 495 stores in 35 countries.

Young segment of the market is also served by Stradivarius. The company runs 361 stores in 24 countries. It offers wide range of informal, imaginative clothing and accessories sold in decorated in vibrant and youthful style stores filled with color, light and vivid music.

Another brand of Inditex is, created in 2001, Oysho. This company specializes not only in women’ lingerie, but also in informal clothes to wear around the house. Oysho has 271 stores spread across 22 countries.

A different kind of assortment is offered by Zara Home. It operates in 20 countries and provides its customers with a variety of textiles, such as bed, table and bathroom linens. It also offers decorative items such as tableware, cutlery, glassware. Zara Home gives its consumers few style options to choose from. These are: Contemporary, Classic, Colonial and White.

Last but not least is a company called Kiddy’s Class. This brand differs from other chains of Inditex as it serves the youngest segment of the market. It offers its young wearers a wide range of clothing, fragrances, cosmetics and small accessories. The company employs �make it easy’ on customers