Zara SA is an apparel brand that specializes in trendy fast-fashion products, including clothing, accessories, shoes, swimwear, and beauty. The company was founded in 1975 by Amancio Ortega, who tapped his daughter Marta Ortega Pérez as Chairman in Nov 2021.
Based in Galicia, Spain, Zara designs low-priced fashionwear with the latest trends in mind. It is part of the Inditex group, the largest apparel retailer globally. In 2021, Zara generated $21.9 billion in revenue. The fast-fashion giant has around 176,600 employees and over 2270 stores globally. [1]
Zara’s business model combines cost-cutting and sustainable practices. Unlike other fast-fashion brands, Zara produces durable and affordable replicas of high-end clothing. It manufactures its apparel and accessories in bulk to provide them at competitive prices.
In May 2021, the company unveiled Zara Beauty to compete with Sephora and Ulta in the beauty product market. Zara also faces stiff competition in the fast fashion sector from H&M, Uniqlo, and Gucci. [2]
Here is an in-depth analysis of top Zara’s competitors and alternatives:
Table of Contents
1. H&M
Year founded:1947
Headquarter:Stockholm, Sweden
H&M is a fashion apparel company that operates in 74 countries under different brand names. The fashionwear giant has more stores globally than Zara. In 2021, H&M employed more than 126,000 people and generated $23.18 billion in revenue.
H&M is one of the leading fast-fashion brands, offering exclusive and affordable top-end replicas in more countries than Zara. The company sells its chic collections and volatile trends globally, including several locations where it is the only fast-fashion retailer.
In Mar 2021, H&M and Zara faced backlash from the Chinese state media for not using Xinjiang Cotton. Three months later, the Chinese government accused both companies of selling harmful fashionwear. Despite these challenges, H&M continues to thrive in many regions globally. H&M is the top Zara competitor in the global fashion retail sector. [3]
2. Uniqlo
Year founded:1949
Headquarter:Yamaguchi, Japan
Uniqlo is a Japanese fast-fashion retailer and one of the leading clothes manufacturers globally. The company operates in Asia and has more experience in the apparel sector than Zara. In 2021, Uniqlo had around 45,000 employees and made over $200 million in revenue.
The main competitive advantage for Uniqlo over Zara is its unique positioning. Uniqlo produces and sells everyday wear at affordable prices. In Feb 2021, the company unveiled the LifeWear aesthetic.
This collection sets Uniqlo apart from Zara and other fast-fashion brands. With over 2200 stores, Uniqlo is Asia’s largest clothing retailer. Uniqlo is the top Zara competitor in Asia. [4]
3. Gucci
Year founded:1921
Headquarter:Florence, Italy
Gucci is an Italian luxury fashion brand owned by Kering Group. The company offers high-end handbags, ready-to-wear, footwear, accessories, beauty products, and perfumes. In the first half of 2021, Gucci’s revenue increased by 45.8% to $5.30 billion. The brand expects over $10.9 billion for FY 2021. [5]
Gucci offers mass-produced and hand-made collections, while Zara manufactures high-end clothing replicas. With around 500 stores and 17,000 employees, Gucci cannot match Zara’s workforce and market presence. But the brand’s revenue is close to Zara’s earnings.
Overall, Gucci is the best Zara alternative for fashion-forward consumers.
4. Nike
Year founded:1964
Headquarter:Beaverton, Oregon
Nike is an American multinational corporation that designs, manufactures, and sells footwear, apparel, equipment, and accessories. The company has around 75,400 employees with annual revenue of $37.4 billion. In 2021, Nike’s US revenue was about $17.36 billion.
Nike is one of the most innovative Zara competitors and alternatives. The apparel giant is venturing into the metaverse to sell virtual Nike-branded sneakers and apparel. In 2019, Nike’s Jordan brand partnered with Fortnite and filed a patent for Cryptokicks. The brand’s foray into the virtual world increases its competitive advantage. Nike has a market value of over $265 billion, making it the largest Zara competitor. [6]
5. Urban Outfitters
Year founded:1970
Headquarter:Philadelphia, Pennsylvania
Urban Outfitters, aka URBN, is a leading lifestyle products and services company. URBN operates several global consumer brands, including Anthropologie, BHLDN, Free People, FP Movement, and Terrain. In fiscal 2021, Urban Outfitters had around 24,000 employees and made $3.45 billion in revenue.
Urban Outfitters reported a record net income of $270 million in the first nine months of 2021. Its net sales increased 14.3% during this period, driven by double-digit growth in online sales.
In 2021, Urban Outfitters opened 46 new retail locations and increased its market share by targeting Millennials and Gen-Zs with trendy clothing lines. Urban Outfitters is a top Zara competitor. [7]
6. Gap Inc.
Year founded:1964
Headquarter:San Francisco, California
Gap Inc. is the largest specialty apparel company in the US that owns several billion-dollar lifestyle brands, including Old Navy, Gap, Banana Republic, and Athleta. Like Zara, Gap offers clothing, accessories, and personal care products. Gap has over 150,000 employees with $13.8 billion in revenue.
Gap’s omnichannel strategy bridges the digital world and its physical stores to enhance shoppers’ experience. Customers can purchase Gap’s products worldwide through company-operated stores, franchises, and eCommerce sites.
In Nov 2021, Gap lowered its annual revenue expectation by between $550 million and $650 million due to supply chain woes. But the company’s diversified portfolio reduces the impact of inventory constraints. For example, Gap’s partnership with Kanye West’s Yeezy delivered a 70% increase in first-time Yeezy buyers. Gap Inc. is one of the top Zara competitors. [8]
We're honored to be named in @BarronsOnline's 100 Most Sustainable Companies List for 2022. At Gap Inc., we're committed to using the scale of our business to change lives and support communities—while delivering products that reduce impact on our planet. https://t.co/2ZTDl7dR8L pic.twitter.com/OfU1ocZTF4
— Gap Inc. (@GapInc) February 18, 2022
7. Forever 21
Year founded:1984
Headquarter:Los Angeles, California
Forever 21 is a renowned fast fashion brand that offers authentic replicas of high-end clothing and accessories. In 2020, Forever 21 filed for Chapter 11 bankruptcy and reached a deal to sell off its assets for $81 million. The company was saved from extinction by new owners. In 2021, Forever 21 had around 600 stores across 57 countries globally.
Forever 21 restructured as part of its bankruptcy deal. Before going bankrupt, its trendy collection was only available via its stores.
In 2021, Forever 21 partnered with several apparel retailers like J.C. Penney and Hudson’s Bay to offer its products. Consumers can find Forever 21’s chic and sassy fashionwear in around 100 Penney stores. The rejuvenated Forever 21 is a formidable Zara competitor. [9]
8. Adidas
Year founded:1949
Headquarter:Herzogenaurach, Germany
Adidas is a German multinational corporation that offers shoes, clothing, and accessories. It is the world’s second-largest sportswear manufacturer, with around 57,000 employees. For the twelve months ending Sep 2021, Adidas’ revenue increased by 13.84% to $25.76 billion.
Adidas offers high-quality, stylish, and durable footwear designed with users’ comfort in mind. According to a 2021 report, Zara and Adidas are the most resold fashion brands.
Zara was second after Nike with 1 million listings, and Adidas came fifth with 611,919. Adidas is more experienced in sporty casual wear and footwear than Zara, increasing its competitive advantage. [10]
9. Fashion Nova
Year founded:2006
Headquarter:Los Angeles, California
Fashion Nova is an LA-based fashion house that operates online and offline via physical stores. But the fast-fashion retailer has only five brick-and-mortar locations. In 2021, Fashion Nova had around 450 employees with estimated revenue of $600 million. Most of its revenue comes from online sales channels.
Although Fashion Nova was founded around 15 years ago, it is already a household name in the fashion market. The main competitive advantage for Fashion Nova is its innovative online strategy. The company has a massive online global following across social media platforms, from Instagram to TikTok. It works with over 1,000 manufacturers and 3,000-5,000 influencers and celebrities to market its high-quality fashionwear. Most of its products cost less than $50, enticing regular customers. Fashion Nova is the youngest and fiercest Zara competitor. [11]
When The Workout Was That Good 🔥https://t.co/X3uWRQTRKq pic.twitter.com/B4uOWPdIXL
— FashionNova (@FashionNova) February 24, 2022
10. Sephora
Year founded:1970
Headquarter:Paris, France
Sephora is one of the leading retailers of personal care and beauty products globally. The company offers over 3,000 cosmetic brands, including skincare, fragrance, nail polish, beauty tools, body lotions, and haircare. In 2021, Sephora had around 1,000 employees with over $1.5 billion in revenue.
Sephora’s private label, Sephora Collection, offers a wide range of beauty products. In Jun 2021, Zara launched Zara Beauty to boost its operations and sales in this sector. Both Sephora and Zara rely on social media influencers to market their beauty products. But Sephora pays a 15% commission on sales to content creators and influencers.
Zara offers only 8%, about half of Sephora’s rate. Sephora is the top Zara competitor in the beauty product sector. [12]
References & more information
- Debter, L. (2021, Nov 30). Zara is Back in Family’s Control after Billionaire Founder Taps Daughter as Chair. Forbes
- Loeb, W. (2021, May 6). Zara Beauty Will Launch Next Week, Competing with Sephora and Ulta. Forbes
- Ray, S. (2021, Jun 3). China Accuses Nike, H&M, And Others of Selling Goods that could be ‘Harmful to Children’ Months after Xinjiang Cotton Backlash. Forbes
- Danziger, P. (2021, Feb 17). Uniqlo Intends to Become the World’s Top Fashion Retailer by Distancing from H&M And Zara. Forbes
- Aloisi, S. (2021, Nov 16). Gucci CEO sees 2021 sales in line with 2019. Perhaps a little higher. Reuters
- Golden, J. (2021, Nov 2). Nike is quietly preparing for the metaverse. CNBC
- Urban Outfitters (2021, Nov 22). URBN Reports Record Sales; Record Profits. Globe Newswire
- Unglesbee, B. (2021, Nov 24). Gap could take $650M sales hit from supply chain woes. Retail Dive
- Halkias, M. (2021, Dec 13). What’s Forever 21 doing inside J.C. Penney? The Dallas Morning News
- Desk Report (2021, Jun 23). World’s top resold fashion brands. Textile Today
- Sponsored News (2021, Oct 18). What Fashion Nova Has Done to Become One of the World’s Most Diverse Brands. The Signal
- Stevens, B. (2021, Sep 29). Leaked documents show how much Ted Baker, Sephora, Zara, and MAC pay their Instagram influencers. Charged Retail
- Featured Image by Abbat
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