Zara and her Sisters: The Story of the World's Largest Clothing Retailer (review)

Within the field of international business and global strategy, the study of how firms cope with the continuing balancing act between global standardization and integration mandates and the need to adapt to the local markets where their customers and other stakeholders reside has been a central topic of debate for several decades. At the core of this discussion has been the frequent inability of some academics to provide empirical evidence showing that actual firms can handle consistently this balancing act, since most multinational firms are unable to deal with these powerful opposite forces. However, one of the firms that seem to have succeeded embracing this balancing act, even in an industry where local preferences can be especially critical for long-term success, is the Spanish firm Zara, the world's largest clothing retailer. How does Zara do it? Is it possible for academics and practitioners to learn something from their particular experience?

Enrique Badía decided to answer these and other interesting related questions by focusing on the history of the corporation behind the success of Zara, Inditex. This historical recount is based on a plethora of sources. First, Enrique Badía spent a significant amount of time visiting Inditex's headquarters in La Coruña (Galicia, Spain) and many of the manufacturing operations, interviewing a selected number of insiders and other key individuals who have been in contact with the organization. In-depth study of company and public documents as well as a multitude of interviews with key Zara and the industry's executives allowed the author to create a detailed description of the creation and evolution of Inditex. Inditex is the world's second largest company in its field, with a presence in more than fifty countries and a market capitalization of nearly 32 billion (around $45 billion). This is a remarkable story, considering that only 40 years ago, this company did not exist, and, nowadays, it employs close to seventy-six thousand employees in four continents and has a turnover of close to $10 billion. The book tells the entrepreneurial story of Inditex, paying special attention to the strong influence of its founder, Amancio Ortega.

The book starts by following the historical roots of Inditex, starting with its headquarters, founder, and the initial undertakings of the company. Badía's review of the company's early history is particularly relevant since the first failure provided strategic lessons for key managers within Inditex. In fact, Badía argues that this early failure set the stage for the longer-term success of Inditex and Zara. The book continues by going into the details of the logistics (production and distribution) within Inditex and why logistics, in contrast to the commonly argued marketing prowess, might be one of the sources of the success of the whole organization. Then, the book moves to recount how Inditex expanded the concept of Zara by acquiring brands (chains) to take advantage of their knowledge of the market and the customers' needs. Additionally, the book explores how Inditex financed its growth by relying on public financing in Spain's market. In the last chapters, Badía goes into the details of the idiosyncratic management model and leadership within Inditex and the role of Ortega in imbuing Inditex with particular "cultural preferences." Badía closes the book by studying the future of Inditex with Ortega moving to a different role within the organization. In this last chapter, Badía addresses the leadership challenges the Ortega family (majority owners) is likely to confront in the near future.

Zara and her Sisters is an enjoyable and insightful reading of the history of a critical player in the global clothing industry. More importantly, it gives a detailed history of one of the global firms able to cope with a multitude of challenges while expanding their operations across the globe over the last few decades. This is not a minor feat, considering...