SWOT analysis and PESTLE analysis on Zara Case Study

by Kady Smith Writer

Title: SWOT analysis and PESTLE analysis on Zara Case Study

Whenever students are assigned to prepare a Zara case study, they mostly are asked to use SWOT and pestle analysis. SWOT analysis is a great technique to point out the company’s strengths, weaknesses, opportunities & possible threats that the company may face. On the other hand, the PESTLE analysis of Zara will help to review the current state of Zara through political, economic, socio-cultural, technological, legal, and environmental factors.

There is nobody, perhaps who haven’t dreamt of owning a Zara product. But writing a case study on it is a whole different story. But don’t worry as we will guide you of the proper application of both SWOT analysis and PESTLE analysis on the ZARA case study.

Case study of Zara with SWOT analysis

As you start writing a SWOT analysis of ZARA, define the desirable objectives of the brand. You need to use the proper SWOT analysis planning model:

Strengths:

The strength of a brand lies in its resources and its capabilities that set it apart from the rest. Take, for instance, Zara has a strong brand portfolio and has a strong distribution network, gets good returns on capital expenditure, etc.

Weaknesses

The weakness here implies certain attributes the company lacks and can be seen as a weakness.

For example:

· Zara was unable to face challenges from new competitions.

· The Net Contribution and profitability ratio at present stands below the industry average

· It failed in getting their firms mixed up with different work cultures.

Opportunities:

Certain analyses may show opportunities for the future growth of the company. It can be the launching of new products, Zara’s new upcoming marketing strategy, new technologies arrival, etc.

Threats:

There might be some possible changes seen in the analysis, which may be able to be threats for the future.

For example:

· The online channel showed a change in consumer buying behavior

· The competitors using newly developed technologies

Now that we are done with SWOT analysis, let’s find a solution for a case study of Zara with PESTLE analysis

You need to go through these six factors while using PESTLE analysis:

1. Political factors

The government sometimes introduces a new economy rule or tax policies that can harm Zara.

2. Economical factors

A change in economic performance in a particular region may have a direct impact on Zara’s profitability. There are several economic factors like foreign exchange rates, interest rates, cost of raw materials, rates of employment, and unemployment.

3. Social factors

These factors determine the rising trends that affect the social environment. Social factors can be useful for having a proper understanding of customer’s needs, education levels, cultural changes, changes in lifestyle, etc.

4. Technological factors

Various advanced technological innovation from other companies may affect Zara.

5. Environmental factors

There are a number of environmental factors that may also affect ZARA. Take, for instance, any change in climatic condition that may affect farming, agriculture, tourism, and insurance.

6. Legal factors

An organization must take into consideration what is legal and what is not allowed. The organization, Zara needs to be up-to-date with any changes seen in legislation and take preparation accordingly.

We hope this guide helps you prepare a case study on Zara using SWOT analysis and PESTLE analysis.