How fast fashion works: can it work for you, too?

Here are the operational keys behind the fast-fashion model and how you can apply it to your own business.

By Felipe Caro & Victor Martinez de Albeniz

Over the past decade, two European retailers have experienced explosive growth, in spite of a record-long recession that saw the retail sector hardest hit as consumer spending nosedived due to the global economic crisis. Ironically, the retailer that has grown the most is based in one of the countries that has suffered the most: Spain. Inditex, with its eight brands (Zara, Zara Home, Massimo Dutti, Pull & Bear, Bershka, Stradivarius, Oysho and Uterqüe) has 6,300 stores in 87 markets. It is the largest apparel retailer in the world in terms of sales. In second place is the Sweden-based Hennes & Mauritz with six brands (H&M, COS, Weekday, Cheap Monday, Monki and Other Stories) sold through 3,200 stores in 54 markets.

The success of these retailers is attributed to a business model known as “fast fashion” — rapidly churning out fashionable designs at affordable prices. Though there are many imitators, these two giants are considered the pioneers responsible for popularizing the model and for transforming the global apparel industry and consumer purchasing patterns as a result.

How they do it is of great interest to other retailers, not only in the clothing business but also in electronics, food and entertainment. What can we learn from the successful execution of the fast-fashion business model?

We have been following fast fashion for several years, writing numerous research papers and studies that have led us to collaborate with Zara and others in the field. In this article, we highlight the operational keys underpinning the fast-fashion model, which are summarized in each of the four graphics that you see in the following pages. These basic attributes are applicable to many different industries.

We also suggest some downsides. Businesses looking to exploit fast fashion would do well to consider the societal and ethical repercussions of the model, as consumers and businesses begin to express greater concern for sustainability in this post-crisis era.

This article is published in IESE Insight Issue 21 (Q2 2014).

This content is exclusively for personal use. If you wish to use any of this material for academic or teaching purposes, please go to IESE Publishing where you can purchase a special PDF version of “How fast fashion works: can it work for you, too?” (ART-2565-E), as well as the full magazine in which it appears, in English or in Spanish.