Comparing The Entrepreneurial Journeys Of Zara And Ikea

2090 Words Dec 9th, 2014 9 Pages
Comparing the Entrepreneurial Journeys of Zara and IKEA
Entrepreneurs use innovation to exploit or create change, such innovation provides opportunity for making profit. They do this by shifting economic resources from an area of lower productivity into an area of higher productivity and greater yield, accepting a high degree of risk and uncertainty in doing so. (Burn, 2011)
Alfred Weber was the first economist to propose a theory of industrial location which states that an industry is located where transport, labour and product cost is the lowest. Thus, the trend towards globalisation has encouraged ‘International Entrepreneurship’, a term used to describe entrepreneurial activities across national boundaries. Firms go global either to expand or due to more market based factors associated with internationalisation through participation in overseas market (Deakins, 2003).
This essay will examine the entrepreneurial journeys of two multi-national retailers, Zara and IKEA, how they managed to gain this level of uniqueness, their main competitors and internationalisation process.
Zara
Amancio Ortega, the founder of Inditex, thought that customers would regard clothes as perishable commodities, no different from yogurt or bread to be consumed rather than stored in closets, and has gone about building a retail business that provides freshly baked clothes. Fast fashion is the evolution from the business model from the 80’s - a quick response in fashion that was applied very…
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