Zara has outsmarted rival fashion retailer H&M in the road to expansion outside Europe.
According to Kyle Stock at Businessweek, H&M has focused too narrowly on catering to shoppers in Western Europe.
Meanwhile, Zara wisely plotted an expansion plan in the fashion-hungry Asian market.
The retailer is opening 80 to 100 stores in Asia per year, according to Stock. H&M is frantically trying to catch up by building a daunting 350 stores on the continent.
A Goldman Sachs report also predicted that H&M’s hesitance to dive into e-commerce will hurt sales over the next three years.
Zara’s revolutionary, fast supply chain is also helping sales.
Because Zara makes its clothes in-house, lead times are much shorter than for other apparel brands, according to Stock.
Zara’s strategy involves stocking very little and updating collections often. Instead of other brands that only update once a season, Zara restocks with new designs twice a week, Suzy Hansen at the New York Times reported last year.
This means that Zara could respond to a chilly spring in Europe by offering more sweaters and jackets.
Analysts predict it could take years for H&M to catch up to Zara’s better planning.
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