A financial comparison on Zara and Burberry.(UK) Essay

A financial comparison on Zara and Burberry.(UK) - Essay Example The first Zara shop opened its doors in 1975 in A Corua,the city that saw the Group's early beginnings and which is now home to its central offices.Its stores can now be found in the most important shopping districts of more than 400 cities in Europe, the Americas, Asia and Africa." (Our Group). However, "Burberry was founded in 1856, when Thomas Burberry constructed his first outerwear pieces for the local sportsmen of Basingstoke, England. In the century and a half since then, Burberry has come to represent the standard for quality and style in outerwear, anchored by its iconic trench coats, now legendary the world over." (Overview: The Past. 1856).Positioning could be seen in terms of the market which companies wish to attract and retain, and the brand and corporate image of the companies registered in the buying patterns of consumers and clients, especially with relation to competing and rival brands. The market positioning a company adopts would depend upon a lot of factors, com petitive or otherwise.In the case of Zara, operations are very swift and fast, both in terms of serving customers and also replenishing stocks, catering to the needs of the customers. Since their stock turns are good, they are able to position themselves well to meet the varied needs of their clientele."At Zara, design is conceived as a process that is closely linked to the public. Information from our stores is constantly transmitted to a design team made up of over 200 professionals, informing them of our customers' needs and concerns." (Zara). Highest standards of excellence and elegance: However, in the case of Burberry Ltd., it is seen that it operates in the luxury segment. Burberry was established in 1856, and has had a chequered history of market vicissitudes due to fall in currencies in principle Asian markets, and market fluctuations. However, the Company has overcome all these obstacles and is now very much poised for bigger growth plans. "An icon of classic clothing, Burberry has utilized licensing and brand extensions to appeal to a younger generation of fashion-conscious customers." (Company History). It can be observed that the marketing approaches and positioning adopted by these two companies, Zara and Burberry are different. According to Zara, "The customer is the centre of our particular business model which integrates design, manufacture, distribution and sales through a wide network consisting of our own stores." (The Company). According to Burberry, "No other brand within the luxury sector enjoys a comparable platform: approach to the consumer, product breadth and global reach. Day after day, year after year, management seeks to capitalise on the opportunities inherent in this positioning." (Strategy and Mission. 1856). Inventory controls: While Zara targets the middle income segment customers with volume of sales as more important, Burberry targets exclusive luxury segments who value highest quality and servicing standards. As a result, the annual number of stock turn of Zara is higher at around 9 times when compared to Burberry at 3 times. These stock turns are important since it is directed connected with inventory controls and movement of stocks. A lower stock turn may indicate slower