Zara is a brand part of the retail empire Inditex. Zara is the leading brand in what has been defined as “fast fashion.” With almost €20 billion in sales in 2021 (comprising Zara Home) and an integrated retail format with quick sales cycles. Zara follows an integrated retail format where customers are free to move from physical to digital experience.
The origin story and business model transformation
Born in a small town in Spain (Villamanín), Amancio started as a delivery boy in A Coruña, a city and the municipality of Galicia, Spain.
As a delivery boy, he got the chance to learn the fundamentals of the garment retail business.
And over the years, he learned that by better organizing the manufacturing and delivery of garments, he could sell those materials at a more competitive price.
He first applied this model to its first brand during the mid-70s.
This retail model would work so well that Amancio would expand all over Spain and internationally.
As its first brand, Zara expanded exponentially over the years; he consolidated his empire under the umbrella of a holding company, Inditex (it took decades and many failed attempts).
Today Inditex comprises eight core brands following similar retail formats, of which Zara is the largest and most prominent, and Amancio Ortega, its founder, is among the wealthiest men on earth.
With almost €20 billion in revenues in 2021, Zara had undergone a business model transformation process, which started with one thing in mind: giving more options to its customers.
Indeed, while starting in 2012, Zara consolidated its stores under a flagship model, it also invested massively in integrating the experience of its customers to make them seamlessly jump from physical to digital without any friction.
The flagship retail model consolidates existing physical stores to have a single location in an exclusive city area.
Therefore, on average, in 2018, Zara expanded its retail space by 50%.
Instead of locking customers’ experience to those physical stores (where Zara had invested billions), the company, in parallel, invested in technologies that enhanced the digital experience.
In short, if today you go to Zara and with your phone can directly scan products to see their availability and order them online in other Zara locations, this is thanks to a deliberate process of transformation of its retail format.
Customers are not locked in a single experience but are allowed to browse the shop and choose whatever format fits them the most.
This is the power of business model transformation, starting with a single focus: enhanced customer experience!

Zara is the core asset of the Inditex Fashion Empire

Inditex is among the largest fashion retailers in the world with eight retail formats:
- Zara & Zara Home,
- Pull&Bear,
- Massimo Dutti,
- Bershka,
- Stradivarius,
- Oysho
The Zara retail format follows an integrated offline-online store network which generated almost €20 billion in 2021 and accounted for over 70% of the group’s revenues.
The key element that has made Zara’s store successful over the years is its ability to anticipate and react to customer demands.

Zara flagship store retail model
Over the last years, Zara has been implementing an integrated retail format leveraging physical flagship stores located in exclusive central locations worldwide.
As reported on Inditex annual reports, the new flagship store opening, starting in 2018, Zara flagship stores were, on average, 59% larger than the first wave of stores opened in 2012 (from 1,452 m2 in 2012 to 2,184 m2 in 2018).
Primarily driven by new store openings, larger flagship stores, and consolidation of smaller stores within a larger flagship store.
RFID technology and Integrated experiences

RFID stands for “radio-frequency identification” and is widely used in retail to track customers’ journeys across several physical and digital touchpoints between the customer and the brand.

Starting in 2007, championed by Zara Home and Zara started a process of digitalization to build a stronger relationship with customers to prevent them from being tied to the physical stores.
This process ended with the transition to an integrated store model.
To complete this process, Zara had to undergo several initiatives to create a trackable experience from the supply chain to the retail experience.
Some of the services implemented to enrich the customer experience were:
- Click&Collect (order online and pick up in-store),
- Self-service checkouts,
- Automated online order pick-up points,
- Same-Day Delivery for online orders,
- And Next-Day Delivery.
Key takeaways
The key elements of Zara’s business model are:
- Product expansions and quick sales cycles combined with continuous product variety to anticipate or react to customers’ wants.
- Integrated shopping experience thanks to new technologies: from RFID to integrated stock management or additional services to enhance the retail model (Click&Collect service, Self-service checkouts, Automated online order pick-up points, Same-day / Next-day delivery).
- Upgrading of physical stores gradually transformed into the Flagship store, located in exclusive locations, which were on average 50% larger compared to 2012.
- The expansion of physical stores has also been coupled with the upgrading of the online sales platforms, thus incentivizing customers to a purchasing experience more congenial to their needs.
In short, Zara’s quick delivery, fast inventory, and seamless customer experience, enabling customers to jump to its physical store and shop online, helped it further consolidate throughout the last decade of digital transformation.
Related To Zara




Related Case Studies
- Fast Fashion
- Ultra Fast Fashion
- Real-Time Retail
- SHEIN Business Model
- Luxottica Vertically Integrated Business Model
- Nike Business Model
- Brunello Cucinelli
- LVMH Group Business Model
- How Does TOMS Shoes Make Money?
- Family-Owned Prada Business Model
- Tiffany Business Model
Related Visual Resources


Patagonia Organizational Structure










Read Next: Zara Business Model, Inditex, Fast Fashion Business Model, Ultra Fast Fashion Business Model, SHEIN Business Model.