Zara Opens New Flagship Store on 5th Avenue

Today, Zara opened a 32,000 square foot flagship prototype at 666 Fifth Avenue at a price of $324 million. As reported by WWD, Zara will be able to create a new brand image with the flagship store because it has more "architectural character," with "virtual catwalks" and rooms highlighting "different aspects of the collection." Even more impressive than its size is its sustainability, proving that eco-friendly is as important to Zara as affordable price points.

The Fashion Grid is excited about this amazing expansion, which is a testament to the success of the international retailer. TFG loves Zara- not only because of their affordable fashions, but mainly because of their brilliant business model.  Zara is one of the few fast-fashion retailers that has an in-house design team working to tweak the designs of the high-fashion lines they are inspired by, making a good faith effort to avoid knocking off designer looks line-by-line (TFG supports inspired by designs, but not knock-offs).

Zara also creates a level of exclusivity in their pieces by avoiding overproduction of any one single item. The design team designs on demand, based off daily sales reports. Ever notice how quickly that blazer you had your eye on disappeared? Remember, the one you saw, hesitated to purchase, only to change your mind, return to the store, and find it has been replaced by a new set of blazers in new colors? That's no accident. It is a carefully calculated component of their operations and once a customer catches wind that Zara's pieces go quickly, they'll be more inclined to make the purchase and feel like they got something valuable- this creates a feeling of exclusivity even though the piece isn't designer label.  Pretty genius people working over at Inditex, Zara's parent company. Not only does the limited production make each piece more valuable to the customer, but it also allows Zara to stay on trend with high turnovers. The retailer produces 20,000 to 30,000 designs each year. At that rate, the flagship store can only do wonders in satisfying the insatiable appetite of fashionistas looking for affordable pieces.

For our fellow fashion geeks out there, check out this Harvard Business School article on Zara.