Contenders

Strong globalization pressures and transferrable assets

Local companies have the ability and opportunity (by developing
skills and resources) to compete with multinationals globally
Concentrate particularly on research and development; production
and management (quality)
Suggested entry strategy: export and invest
Focus on niche market
Examples of contenders:
1. Zara (ES)
Built in Spain, has expanded successfully worldwide
Has successfully become the most famous Spains clothing
brand
Has successfully won over other fast-fashion brands, for
example H&M and GAP
Key to success (competitive advantage):
Affordable and fashionable at the same time (designs
are up-to-date with the current trends)
Fits all ages
Supply chain
- Fresh inventories the fastest retailer in producing
new designs
- Manufacture based in Spain and neighboring
countries Portugal, Turkey and Morocco, instead of
Asia (like most brands do), for fast delivery of goods
(shipment)
- Keeps low inventory, in order to prevent possible
losses. In case of merchandises not selling, Zara
quickly discontinue supply.
Able to adapt to change of consumers shopping habit
Listens to customers wants and needs (customer
feedback)
Easy to reach located mostly at prime locations, online
shopping is available (keeps up with the trend
ecommerce)
2. AmorePacific (KR)
Koreas #1 cosmetic and skincare house Sulwhasoo, HERA,
Mamonde, Laneige, Innisfree, Etude House
Debuted at #28 (in 2015) and currently ranked #21 (in 2016)
in Forbes Top 25 Most Innovative Companies
Have expanded to USA and Middle East
Key to success:
Invested on research and development pioneer of BB
Cushion (created a global trend)

Focus on natural ingredients first company to use

ginseng
Quality is a legacy
Varies target market
Value for money
Korean uprising stars as marketing strategy

Advantages and disadvantages:

Economic growth
Nations pride
Opening up opportunities

Challenging for local startups to surpass the success rate

References:
Chaudhuri, S. and Kowsmann, P. (2016) Zara Owner Inditex Stays Ahead of
the Competition [online]. Available from: http://www.wsj.com/articles/zaraowner-inditex-profit-beats-forecasts-1465968167 [Accessed: 23 November
2016]
Chung, G. (2015) How South Koreas AmorePacific Became One Of The
Worlds Most Innovative Companies [online]. Available from:
http://www.forbes.com/sites/gracechung/2015/08/19/how-south-koreasamorepacific-became-one-of-the-worlds-most-innovativecompanies/#a435ab1689cf [Accessed: 23 November 2016]
Dawar, N. and Frost, T. (1999) Competing with GIANTS. Harvard Business
Review [online], 77 (2): 119129. Available from:
http://web.b.ebscohost.com/ehost/pdfviewer/pdfviewer?sid=ca2886fa8e53-4ae9-9b1d-760f5f1f2911%40sessionmgr101&vid=1&hid=124
[Accessed: 23 November 2016]
Dyer, J. and Gregersen, H. (2016) How We Rank The Most Innovative
Companies 2016 [online]. Available from:
http://www.forbes.com/sites/innovatorsdna/2016/08/24/how-we-rank-themost-innovative-companies-2016/#79ecaa797659 [Accessed: 23
November 2016]
Ensari, M.. (2016) A Research Related to the Factors Affecting
Competitive Strategies of SMEs Operating in Turkey. International Journal
of Business and Social Science [online], 7 (2). Available from:
http://ijbssnet.com/journals/Vol_7_No_2_February_2016/6.pdf [Accessed:
23 November 2016]
Hiiemaa, K. (2016) In the success stories of H&M, Zara, Ikea and Walmart,
luck is not a key factor [online]. Available from: https://erply.com/in-thesuccess-stories-of-hm-zara-ikea-and-walmart-luck-is-not-a-key-factor/
[Accessed: 23 November 2016]
JoongAng Media Network (2015) After 70 years, AmorePacific doing better
than ever [online]. Available from:
http://koreajoongangdaily.joins.com/news/article/Article.aspx?
aid=3003681 [Accessed: 23 November 2016]
Parekh, R. (2013) How Zara Ballooned Into a Multi-Billion Dollar Brand
Without Advertising [online]. Available from: http://adage.com/article/cmostrategy/zara-grew-a-multi-billion-dollar-brand-sans-ads/243730/
[Accessed: 23 November 2016]

Sowray, B. (2015) The 5 ingredients of Zaras success [online]. Available

from: http://www.telegraph.co.uk/fashion/brands/the-5-ingredients-ofzaras-success/ [Accessed: 23 November 2016]