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QAB020N522A Retail Theory and Practice Assignment Sample


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There have been several changes in the UK fashion clothing market in the last decade. In the initial times, clothes were being sold in the large shops and retail outlets which attracted the customers. With the introduction to the e-commerce sites, the market of the retail sector has totally changed. Some of them are still struggling to cope up with the changes that have taken place over these years. With the clothes being sold online with the help of the websites and the marketing of the products being done through social media, it has hit the retail market at a huge level. This report will comprise of the various factors that have influenced and impacted the market of Zara Fashion Company in order to have a proper understanding of the clothing sector of the UK market. A few strategies that can be implemented in order to fix these changes are also discussed in the report below.

Changes within the Zara Fashion Retail Market

Economic Changes

The UK is one of the largest economies in the world. It takes the position of being fifth amongst the other economies. The main reason that contributed to the smooth functioning of the business activities which led to the success of the country's economy is the increase in the population of the UK. Although, there has been a recession that struck the country in the year 2008. Zara is one of the most popular brands that have been storing new sets of clothes every two weeks due to the huge demand of its products by the customers. During this recession period, the brand failed to achieve its targets and thus faced a lot of financial crises. It was very difficult for the individuals to carry out their normal lifestyle during this period of recession. It was far more difficult for them to buy clothes. This situation impacted Zara tremendously. It was forced to store its products and clothes for a longer period than it had expected (Egan, 2019).

Another factor that has impacted the economic change of the UK market is the increase in the rates of inflation. There has been a significant rise in the rate of inflation in 2017. This rise in the rate of inflation in the market enabled the rise in the prices of the clothes which made it further difficult for the customers to make a purchase of these items. As the clothes made by Zara are done in Spain, due to the increase in the inflation rate the clothes were being imported to the country at a higher price. This resulted in the increase in the price of the final products by Zara. This has hugely impacted the confidence of the customers and the brand is striving to gain back their loyal customers and their confidence back on them. It was very obvious that there has been a significant depreciation in the demands of the customers as they were not being presented with a proper reason for the increase in the price of the clothes and the outfits. This has made it difficult for the company to make sales and generate good revenue for the profitability of the company.

In addition to the above factors, there has been an increase in the corporate taxes in the UK. The corporate taxes constitute one of the largest expenses that a company bears. Increase in the corporate taxes will significantly lead to a simultaneous decrease in profit making and will thus lead to less sharing of money between the owners and partners of the business.

Political Changes

With the impact of BREXIT, the company faces uncertainties regarding the increase in the price of the clothing sector. With the exit of the UK from the EU, there will be an introduction to the new changes in the trade terms and new tariffs will be introduced as well. With such a change, Zara will now have to pay the price of the importation of its products that is made in Spain. This would result in the increase in the price of the clothing products sold by the company. An increase in the selling price of the clothes by the company will decrease the demands of the customers. Also, the fashion competitor companies will be benefited from this and the company will suffer a huge loss both in terms of demand and supply as well as in the competition market as well (Knezevicet al., 2019).

As the policy before BREXIT emerged was not formulated which leads to a further cause of uncertainty in how the business will be operated post the policy framing is done and once the UK exits from the EU. There has been no particular direction given to the fashion retailer about the various ways it will be allowed to operate in the market.

Technological Change

The UK is one of the fastest bandwidths that exist on the continent. With the investigation in technology and that of smartphones the market of the UK retail sector changed tremendously. With the availability of the smartphones there has been a shift from the customers' attention to the online shopping over the websites. The company has been facing this continuous challenge of investing over the e-commerce websites and launching of the new websites (Esparza, 2018).

Environmental Changes

During the period of recession, it was hard for the businesses to grow at a rate that they had expected. Zara Company wanted to expand its stores with the help of more sales in the country, but this idea and planning was being disrupted by the condition of the country and more sales were discouraged. The period of recession also made it massively difficult for the company to keep the expected price of its products and follow the policy of replacing its products and stocks twice in a given week. But they failed to achieve their expected target due to the conditions of the market in the country.

Legal Changes

With the introduction of the GDPR, the policy implemented various clauses that there should be transparency between the customer and the ecommerce and social media firm on how they are using their personal details. Zara has been hugely impacted with the impact of such effects. In order to avoid the effects of litigation, the company should abide by all the rules and regulations formulated by GDPR. Another rule that came into force and was implemented required the companies to give details about their employees along with their gender and salaries on a monthly basis. This has hugely affected Zara as it employs more than 250 employees (Cuadros, natalie, 2018).

Social Changes

With a diverse ethnicity in the market of the UK, it becomes very important for the companies to fulfill the needs of the individuals coming from different backgrounds. Unless the demands of the customers are met, it would not generate customer satisfaction.

Strategies to implement in order to get a better result

  1. The company should introduce a new manufacturing plant in order to avoid the tariffs that are included in the importing after the BREXIT regulations have been applied.
  2. The company should focus on promoting its products and services in both ways such as traditionally as well as digitally. With the increase in the trend of digital marketing, the promotion of the products will reach out to a larger mass and will attract customers from all over the globe.
  3. The company should try out various platforms in order to drive sales and sell its products. Both ecommerce and retail shops are important in terms of making sales and generating revenue.
  4. One of the best ways to have a higher authority over the competitors is to innovate more products and services. Innovation of the products of the company drives in more sales as it attracts huge customers
  5. The company should abide by the various rules and regulations that are set by the higher authorities. They should maintain transparency between the organisation and the customers and the customers should have a clear idea of how their personal details havebeen used by the organisation.


The changes that have taken place over the year in the retail sector have been very challenging for the companies as well as for the individuals as well. The condition post BREXIT has created many difficulties and confusion amongst the countries and has impacted their trade and rate of profitability in the market shares. Their business has been hugely impacted by the BREXIT condition. Zara has gone through massive loss in its business because of the recent condition of the market. It can strategically formulate ideas and plans and implement them in order to make sure that these benefit the sales of the company and increase its profitability and revenue generation. It should consider all the options in order to sell its products and the promotions can be done both traditionally and digitally to attract the customers from all over the globe. This implementation of the strategies will help the company reestablish itself in the market and grow its business.


Cuadros, natalie, (2018). Bremaining in Vogue: The Impact of Brexit on the Fashion Industry. Am. U. Bus. L. Rev., 7, p.129.

Egan, M., (2019).EU single market (s) after Brexit.Politics and Governance, 7(3), pp.19-29.

Esparza, R., (2018). En Vogue: The Risks of Brexit to the European Fashion Industry. International Journal of Legal Information, 46(3), pp.163-175.

Knezevic, B., Renko, S. and Knego, N., (2019).Changes in Retail Industry in the EU.Business, Management and Education, 9(1), pp.34-49.

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