Zara comes up with new Business Strategy to boost Sales
Zara made a move with an aim to woo the price-conscious Indian consumers and help brand to counter-attack the aggressive expansion plans of Swedish fashion rival H&M in India.
To beat its arch-rivals in the fashion retail business, Spanish fast-fashion brand Zara has decided to slash the entry-level prices of its products in India by more than 50 per cent. The current price range of the clothes from Rs. 799 to Rs. 390. These range has made accessible of Zara clothes at even wider range of shoppers at different locations.
Markedly, Zara reported a 40 per cent decline in its net profit to Rs. 48 crores despite a 21.4 per cent increase in sales to Rs. 1,023 crores in fiscal 2017.
Zara facing a tough market competition from the arrival of H&M in India in 2015. H&M, in the meanwhile, reported a twofold increase in its India sales to Rs. 954 crores in the year ended November 2017 as compared to Rs. 490 crores in the same period of 2016.
Zara currently operates more than 21 stores in India while H&M is preparing to take its store count to 30 in India by the end of this year.
Notably, Zara has already launched its online operations in India in October last year whereas H&M is planning to open a digitial store soon. Inditex, the parent company of Zara, has fixed Rs. 290 as a delivery charge for standard deliveries while no delivery fee is levied on shopping over Rs. 4,000.
H&M expansion plans are giving tough competition Zara, GAP, Levi Strauss, Benetton. H&M which is gaining popularity in the Indian market and has plans in place to further increase its store count to around 50 with an investment of Rs. 700 crores in the next two years.
– Apparel and Textile News, Apparel Talk, Indian Apparel