Zara is one of the biggest retail clothing chains in the world. It is run by the fashion giant Inditex, the company behind Bershka, Pull&Bear, Masimo Dutti, Oysho, and Stradivarius.
The company, headquartered in Arteixo, Spain, was founded in 1975 by Amancio Ortega and Rosalia Mera.
Aside from its on-site transactions, the company is also one of the leaders in fashion e-commerce, having opened its first online store in 2010. As of 2021, over 25% of Zara’s sales were made online.
Zara is known as one of the leaders of the “fast fashion” industry. In fact, the term “fast fashion” was coined after Zara’s business model. The New York Times first used the term in the 1990s to describe the company’s ability to move products from production to the market within 15 days.
The firm can speed up the supply chain with strategically placed manufacturing and distribution. With this, Zara can dispatch new items to its 400,000-square-meter central distribution facility in Arteixo, Spain, twice a week.
However, this supply chain structure is also often met with controversy —especially environmental concerns—due to the relatively short time it takes for these clothes to end up in landfills. Environmentalists call fast fashion clothes “made with carbon emissions.”
Zara began as a dressmaking business run by the couple Ortega and Mera in Galicia, Spain. They later turned their manufacturing business into a retail store, which they first called Zorba. After establishing multiple locations, the couple decided to create a parent company—Inditex.
Inditex successfully established many other brands, but Zara remains its most prominent. Per Forbes’ latest report, Zara is ranked Number 41 Most Valuable Brand. Currently, the brand alone has a valuation of around $13 billion.
In 2021, Inditex generated revenues of $30 billion. Zara has over 6,500 locations in more than 200 countries and employs 162,000 people. Aside from Zara, Inditex operates six other subsidiary brands.
Methodology
The methodology with which competitors of Zara are ranked is based on various data points. Information such as the number of stores, revenue, number of employees, sister brands, and everything else deemed relevant is being considered.
This analysis is limited to fashion retailers focusing on mid-market consumers. Thus, we did not include luxury brands such as LVHM, Chanel, and the like.
Also, brands like Adidas and Nike, known for their athletic wear, are not considered. Fashion marketplaces, which include companies like Poshmark and Vinted, are also excluded from this comparison, as they primarily cater to secondhand fashion. Lastly, we won’t consider competitors in the firm’s Home division.
It has to be noted that this analysis should not be taken as an endorsement for any of the services listed below. It is merely a summary of the competition that Zara faces today.
So, without further ado, let’s take a closer look at Zara’s top 12 competitors.
1. H&M
Headquarters: Stockholm, Sweden Founder(s): Erling Persson Year Founded: 1947
H&M, formally called Hennes & Mauritz, is one of the leading fast fashion brands. Amidst the issues often attached to fast fashion brands, H&M is especially known for its efforts in sustainability and climate-smart processes.
Founder Erling Persson got the idea of a fashion retail business when he took a trip to New York. He tried to bring this concept back home to Sweden and established Hennes (meaning “hers”).
Twenty-one years later, Persson acquired the hunting apparel brand Mauritz and started selling men’s clothing. This move led to the company’s rebranding as H&M or Hennes & Mauritz.
Throughout the 1970s, H&M unstoppably grew from country to country, eventually leading to an initial public offering on the Stockholm Stock Exchange in 1974. In 1982, twenty years before Persson’s death, the founder stepped down as H&M’s CEO. With the growing popularity of the Internet, the company opened its first online store in 1998.
Compared to Zara, H&M has lower prices and is more friendly to plus-size customers. And while Zara tends to have questionable transparency regarding sustainability efforts, H&M has visible campaigns on this subject (an example is the Sustainability Point).
In 2021, H&M made $23 billion in revenues. The company employs more than 110,000 people and operates about 5,000 stores in Europe, the US, Asia, and the Pacific. Aside from its leading brand, H&M is also the company behind COS, Monki, Weekday, Cheap Monday, & Other Stories, ARKET, and a Home division.
Feel free to check out the competitors analysis of H&M here.
Source: About H&M, HM Group History, HM Group Investor Relations
2. SHEIN
Headquarters: Nanjing, China Founder(s): Yangtian Xu, Xiaoqing Ren, and Yang Pei Year Founded: 2008
If Zara is already so fast at producing and distributing clothes in the market, wait until you see SHEIN’s ultra-fast fashion business model. SHEIN has been buzzing since the pandemic for its swift supply chain, which can create products from idea to consumer readiness in as little as three days.
SHEIN started as an online wedding dress store. But after seeing stagnancy, founder Yangtian Xu (also called Christian Xu) completely changed SHEIN’s business model in 2013. Today, the company is a go-to place for trendy, Instagram-worthy, but low-priced outfits, even lower than Zara’s.
However, such cheap prices and fast production come at a cost. For years, SHEIN has been the subject of scandals over poor working conditions among employees and design theft. Not to mention, SHEIN’s ultra-fast system is negatively affecting the environment.
SHEIN responded to this with a pledge to lower emissions and waste, despite insufficient transparency reports. However, it’s been observed that SHEIN is now gradually converting to recycled polyester and other sustainable materials.
In 2021, SHEIN generated revenues of $15 billion. Unlike Zara, SHEIN is a purely online business, with its app having 177 million downloads. The company currently employs more than 10,000 people.
Sources: About SHEIN, Brightly, Hazard Magazine, Statista
3. PVH (Phillips-Van Heusen)
Headquarters: New York City, New York, United States Founder(s): John Van Heusen, Dramin Jones, Moses Phillips Year Founded: 1881
PVH Corp is the name behind Calvin Klein, Tommy Hilfiger, Warner’s, Olga, and True&Co. With a 140-year-old history, PVH is considered among the biggest clothing companies and is even included in the Fortune 500.
The company was established by Moses Phillips and his wife, who sold handmade shirts. They later merged with D. Jones & Sons and were incorporated as Philips-Jones Co. Inc. in 1919. It was also around that time when the company started to manufacture underwear.
Philips-Jones Corp. was listed on the NYSE by 1920. In 1957, Phillips-Van Heusen was renamed after its best-selling brand. By the 1990s, PVH had already led shirt brands in the US. In 2003, it also bought Calvin Klein, which became the most iconic name in its portfolio.
The company’s supply chain is a mix of third-party suppliers and owned manufacturing facilities. Although the company’s earlier growth came from its shirts, many of the brands it owns are now notable for high-quality undergarments.
In 2021, PVH Corp. generated $9.2 billion in revenues. Currently, the company operates 1,700 combined stores for all of its brands. Per estimates, around 31,000 people work at PVH.
Sources: About PVH, Business Wire, Funding Universe, Macrotrends
4. Uniqlo
Headquarters: Yamaguchi, Japan Founder(s): Tadashi Yanai Year Founded: 1949
Uniqlo is the flagship store of Fast Retailing Co. Ltd. The company is known for high-quality products with generally lower prices than Zara and other brands.
Yanai, the company’s founder, started the company from his father’s business called Ogori Shoji He. In 1984, the venture was renamed Unique Clothing Warehouse. Four years later, Yanai aimed to conquer international markets.
However, the company’s name was misspelled during its registration in Hong Kong—hence, the name Uniqlo. Over time, the brand expanded from casual wear to a wide range of other categories, like athleisure clothing.
Today, Uniqlo is famous for fashionable but safer styles. In comparison, Zara generally tends to make bold trend predictions. On the other hand, Uniqlo prefers to simply follow current trends. The company also doesn’t own a factory but outsources all of its products to various producers in Asia.
Currently, Uniqlo owns 2,394 stores and employs about 56,000 people. In 2021, the brand generated $6.2 billion in revenues. Its parent company, Fast Retailing Co., also owns GU, PLST, THEORY, Theory Luxe, Helmut Lung, Comptoir des Cotonniers, Princesse Tam-Tam, and J Brand.
Feel free to check out the competitors analysis of Uniqlo here.
Sources: About Fast Retailing, Fast Retailing Investor Relations, Prophet, Statista, Uniqlo
5. Zalando
Headquarters: Berlin, Germany Founder(s): David Schneider and Robert Gentz Year Founded: 2008
Zalando is an online fashion retail company that mainly serves Europe. It operates as a purely online venture, although it opened its first physical Beauty Station store in Berlin in 2018.
Unlike Zara, Zalando’s supply chain mostly depends on suppliers and third-party warehouses. Per the latest reports, the company partners with over 120 sourcing partners in 16 countries.
Its founders, Schneider and Gentz, met in college and were bonded by their mutual interest in entrepreneurship. They found the business model of Zappos (an American fashion retailer) exciting and thought of establishing a comparable online shoe store for the European market.
Although they were met with doubts, the two went on to start Zalando with the help of a German venture capitalist named Oliver Samwer.
After six years of operations, Zalando was able to go public in 2014, raising about $668 million. While it’s true that Zalando is behind Zara in popularity, it is among the leading European companies in the fashion e-commerce landscape. Zalando accounts for more than 13% of Europe’s online apparel market share.
In 2021, Zalando earned more than €10.4 billion in revenues. Its Private Labels include the brands Even&Odd, Anna Field, Pier One, Friboo, ZIGN, and Youturn. According to its latest report, Zalando has around 17,000 employees.
The company maintains separate websites for each country to accommodate varying European mother tongues. Per estimates, each website is visited 1–9 million times every month. On the other hand, Zalando is not directly engaged in on-site selling (aside from Beauty Station in Berlin), although the company partners with various third-party stores.
Feel free to check out the competitors analysis of Zalando here.
Sources: About Zalando, Digital Commerce 360, Pitchbook, Zalando Sustainability
6. The Gap
Headquarters: San Francisco, California, United States Founder(s): Donald Fisher and Doris Fisher Year Founded: 1969
The Gap is an international clothing retailer most notable for its jeans and other denim products. For decades, the company’s brand has been a household name for laid-back styles and streetwear aesthetics.
The Fisher’s built the company to ” fill the gap” in the fashion industry. During that time, it was difficult for many people to find the right size of jeans. The company quickly grew, filing an initial public offering in 1976. By the ’80s, The Gap already had a total of $1 billion in sales.
The Gap’s long history has been a roller coaster ride. They also had to shift from unisex styles to more gender-specific fashion in the ’90s to address a decline in sales. The company also had to close more than 220 stores during the pandemic.
In the past years, The Gap has also been struggling to attract more Millenials and Gen Z, considering the momentum they had in the previous millennia. Nonetheless, the company has been making efforts to stay a relevant brand.
In 2021, they collaborated with Walmart to showcase their Home department and potentially promote their other products. Furthermore, The Gap has also been closing physical stores to focus more on e-commerce.
In the same year, the company generated a revenue of $16.7 billion. Currently, they operate over 2,800 stores and employ 100,000 people. The Gap also operates other well-known brands such as Old Navy, Banana Republic, and Athleta.
Sources: CNN Business, Statista, The Culture Trip, The Gap Investor Relations
7. Primark
Headquarters: Dublin, Ireland Founder(s): Arthur Ryan Year Founded: 1969
Primark is a fashion retail company that offers relatively low prices compared to most companies in the same industry. Before it became Primark, it was initially launched as Penneys in Ireland. Up to this day, around 36 stores in the country retain that name.
Ryan established the company under Associated British Foods (ABF), which remains Primark’s parent company. Over time, the Primark brand became ABF’s biggest source of income.
A significant part of Primark’s success is the lower tag prices. While Zara isn’t generally seen as a low-price brand, Primark is often considered affordable. Moreover, Primark’s prices in Spain are almost half what Zara offers – despite the closer transportation routes.
Another unique thing about Primark’s business model is that it doesn’t sell online, thus eliminating costs for additional packaging and shipping. Instead, their website can be used to pre-browse products and check availability.
In addition, they also spend less on marketing to compensate for their lower tags. Therefore, Primark largely relies on word of mouth to advertise its brand. Despite their effort to reduce operating expenses, Primark still faces allegations, including low employee wages.
Nonetheless, Primark remains a thriving venture in Europe. The company earns GBP 5.6 billion every year and has 72,000 employees. They operate 404 stores in 14 countries, which are mainly in Europe.
Sources: ABF, About Primark, Our Economy, Primark Careers
8. Urban Outfitters
Headquarters: Philadelphia, Pennsylvania, United States Founder(s): Richard Hayne, Scott A. Belair, and Judy Wicks Year Founded: 1970
Urban Outfitters is a brand under the URBN portfolio. The company is most notably known for its unique stores, which look different in every location, thus giving the customers a travel-like experience while shopping.
It is not surprising, as one of its founders, Hayne, is an anthropology graduate. Together with Wicks and Belair, they conceptualized a retail store, originally a project for Belair’s entrepreneurial class.
The idea didn’t stop when Belair got an A for the project, and it was put to life. By 1976, Urban Outfitters was already incorporated. Throughout the 1980s to 1990s, the trio established several branches in the US.
Urban Outfitters quickly became recognizable among patrons due to its counterculture approach in each location. This made the shopping experience more casual and fun. Furthermore, the company also trained its staff to connect to customers more personally. Overall, Urban Outfitters’ marketing strategy intensely relies on creativity.
The company’s supply chain mixes self-manufactured products and outsourced clothing. They have manufacturing facilities in China and other East Asian countries. Urban Outfitters distributes these clothes to 260+ stores, mainly in the US and Canada.
In 2021, URBN Co. earned revenues of $4.3 billion. They currently employ 23,000 workers. Urban Outfitters sister brands include Anthropologie, FREE PEOPLE, Nuuly, FP Movement, Terrain, and BHLDN.
Sources: Macrotrends, Panaprium, Reference for Business, URBN Annual Report, URBN Brands
9. ASOS
Headquarters: London, United Kingdom Founder(s): Nick Robertson, Andrew Regan, Quintin Griffiths, and Deborah Thorpe Year Founded: 2000
ASOS is a fashion retail brand that operates purely online. Thus, the company does not own physical stores. ASOS is primarily known for its customer-centric culture and gender-neutral clothing and designs that people can relate to.
The company was initially launched as AsSeenOnScreen and sold clothing and other items seen in movies and TV shows. After a year of operations, ASOS made the bold move of going public through the Alternative Investment Market, a sub-market of the London Stock Exchange. In 2022, ASOS finally moved to the LSE.
Despite its apparent success, ASOS has suffered several warehouse fires. The first was in 2005 when they were involved in the Buncefield Fire. In 2014, they again suffered a fire incident that burned 3-million-pound assets. Lastly, another ASOS warehouse was smoldered, resulting in a loss of 6 million pounds.
Unlike Zara, ASOS gets most of its products from third-party brands and suppliers, although they also have 24 factories. Currently, the company features around 850 brands, including Adidas, Havaianas, Neutrogena, Tommy Hilfiger, and many other prominent names in fashion.
In 2021, ASOS earned 3.9 billion euros in revenue. Currently, over 3,000 people work at ASOS. Aside from the third-party brands it sells, the company owns 17 brands, including Reclaimed Vintage, Topshop, AsYou, and Dark Future.
Feel free to check out the competitors analysis of ASOS here.
Sources: ASOS Brands, ASOS Featured Brands, LinkedIn, London Stock Exchange, Statista
10. Forever 21
Headquarters: Los Angeles, California, United States Founder(s): Do Won Chang, Jin Sook Chang Year Founded: 1984
Forever 21 is a chain of clothing stores that mostly led the field in the 2000s. However, later in the decade, the company failed to adapt to changing consumer tastes. It ultimately resulted in Forever 21’s bankruptcy in 2019.
The company was first established as Fashion 21 by South Korean immigrants Do Won and Jin Sook Chang. In just one year on the market, the company has already reported sales of $700,000. By 2015, the couple, who formerly worked low-paying jobs, already had a combined net worth of $5.9 billion.
Eventually, many customers shifted to e-commerce platforms like Amazon, and Forever 21 is among the brands that failed to adapt. In only two years, the firm had to file for bankruptcy, and Forever 21 was sold for only $81 million to Authentic Brands Group (ABG) in the following year.
Several stores were shut down following the bankruptcy. From 700+ locations, Forever 21 only has 540 stores now. During its peak in 2015, the firm generated a whopping $4.4 billion in revenues. They also employed around 30,000 people.
In 2022, hopes for revival came to light when a new Forever 21 store opened in Calexico, California. It was reported that 13 more locations will soon open in various malls in the US through 2023.
Following ABG’s take-over, Forever 21 now counts Aeropostale, Brooks Brothers, Barneys New York, Airwalk, Frederick’s of Hollywood, Lucky Brands, Nautica, Tapout, and Sports Illustrated as sister brands.
Sources: CFO, Forever 21, Knowledge at Wharton, Retail Dive
11. Boohoo
Headquarters: Manchester, United Kingdom Founder(s): Karol Cane and Mahmud Kamani Year Founded: 2006
Boohoo is an ultra-fast fashion retail company focusing on social media marketing and customers aged 16 to 30. The company is owned by Boohoo plc., which operates several other clothing brands.
Its founder, Kamani, got the company as a small-time textile business from his father in 1993. In 2006, he hired Cane, a fashion graduate, to join him. Boohoo started as an online store in the UK, and while many competitors struggled during the pandemic, it thrived with its default online setup.
Boohoo’s target market is the digital natives, so one of the critical components of its operation is its online marketing – as exemplified by its 13 million Instagram followers.
Nonetheless, the company also has a physical presence. They opened their first location in New York in 2014. Today, Boohoo operates 13 stores in the US, UK, Italy, France, and Turkey.
In 2021, the company generated a revenue of $800 million in the main Boohoo brand alone. Currently, 5,350 employees are working on Boohoo and other sister brands like Coast or Misspap.
Sources: Boohoo plc, Statista, The Guardian, The Sunday Times, WWD
12. Mango
Headquarters: Palau-solità I Plegamans, Spain Founder(s): Isak Andic and Nahman Andic Year Founded: 1984
Mango is a Spanish fashion retail company with most of its stores in Turkey. The company offers products for men, women, and children, and most of its clothes cater to students and young professionals.
The firm was founded by Turkish brothers Isak and Nahman, who opened the first store in Barcelona. By 1985, Mango was operating at five outlets. They decided to enter international markets in the following decade, starting in Portugal.
Zara caters to budget-conscious customers, whereas Mango caters to upper- to middle-class society. Nonetheless, the Andic brothers built most of their branches in their home country of Turkey.
Mango outsources its products to various independent manufacturers in China, Turkey, India, Vietnam, and Morocco. Their prices fall in the same range as Zara’s, but Mango tends to have more promotional efforts.
Today, Mango operates around 2,700 stores and employs more than 10,000 employees. In 2021, the firm earned $1.2 billion in revenues.
Sources: Fashion Network, Fashion Network, Indeed, Textile Today
