English Vocabulary Words: Zara’s profits soar

This text is about how Zara has become so profitable. One of the keys to learning the language is increasing your knowledge of English vocabulary words. Some words/phrases that may be new for you are highlighted and explained below.

  All of Europe is talking about the Euro crisis and how hard business is… but not for ZARA. It is the world's largest clothing retailer and has just made a €432m profit. That is even higher than forecasted. Their secret weapon is expansion. Shoppers are generally spending less and many shops and retailers are closing down throughout Europe. Yet, Zara has reported a 30% increase in the number of customers visiting their stores. This is a huge amount of shoppers who now prefer Zara to other clothes shops. As a result, the retail giant has become Spain’s largest company. It is so big that it can design, make and sell new clothes within just 2 weeks. That’s why they seem to have the newest fashions on the high street. This "fast fashion" formula has proven a hit at home and abroad. Zara’s domestic market only accounts for a 1/4 of their sales so where is the rest from? Well, they have expanded almost everywhere, establishing chains in 85 countries including the very profitable emerging markets such as Asia. Due to this expansion they now only make 1/3 of their clothes in Spain and so save money on transport and labour costs. The clothing giant’s main competitors are faring far worse.  Esprit and H&M see sales flagging. Zara, on the other hand, is expanding even more, opening 91 stores in 26 different markets including a flagship store on New York's Fifth Avenue. Zara has even expanded into other areas too. It now owns eight other retail brands including Bershka, Massimo Dutti and Pull & Bear. In total Zara has more than 5600 stores worldwide and an estimated market value of nearly €48bn. The future of Europe may be uncertain but Zara’s future looks very bright indeed!    

Useful English Vocabulary Words

Euro crisis
The current big economic problems in Europe
Secret weapon
Powerful strategy or method
To grow and move into other areas
Retail giant
A big retail company
Fast fashion
Clothes shops that can create and sell new designs very quickly
Proven a hit
Become popular
Domestic market
Selling in the home country of the business
Emerging markets
New places where you can sell lots of products
Labour costs
The price you pay employees
Faring far worse
Doing badly in comparison
Sales flagging
Poor and maybe declining sales
Flagship store
The main shop which is a good symbol of the company


Discussion Questions


  1. Why do you think Zara is so popular?
  2. What can other companies learn from their success?


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