Zara’s Global Pricing Strategy: Same Dress, Double the Cost in Some Countries

A comparison made by the site 20minutos reveals a remarkable fluctuation in the prices of the same denim dress from the new Zara collection in 20 different countries. It emerges that the dress is offered in Kuwait and Saudi Arabia respectively at 74.76 euros and 72.88 euros, practically double its Spanish price of 39.95 euros. Mexico displays a price of 67.68 euros for this same dress, and it is offered at a price above 63 euros in Morocco, Vietnam, the United States and Ecuador.

In Europe, the average cost of a denim garment is 49.95 euros. However, Iceland, for example, offers the same dress at a price close to 60 euros, which represents an increase of 20% compared to the standard price. Portugal and Greece, like Spain, display a price of 39.95 euros for this dress, which is the most advantageous price in Europe. Andorra stands out with an even more competitive price of 39 euros, due to a VAT rate of 21% applied in Spain, compared to only 4.5% in this European micro-state.

In addition to VAT, the distance between the country of origin and the importing country also influences the price variation. The greater the distance, the higher the transportation costs. Furthermore, the local purchasing power (per capita income, minimum wage, cost of living and quality of life) is a crucial factor to consider when setting the price of a product in a given market.