The Effects of Zara to the SMEs of an Emerging Market

Abstract

Abstract Globalization can be described as a systematic decline in the boundaries of the cross-national flow of products, values, ideas, labors and capitals. In other words, globalization disregards any physical boundaries and wipes out the classical meaning of domestic market. Therefore it creates a true challenge for every local enterprise but especially for SMEs (Small and Medium Enterprises) of the emerging countries since competition is increasing and every local industry is losing its exclusively national character by globalization. While the definition of SMEs can easily be a topic of an academic paper, SMEs are commonly regarded as small business systems with some unique characteristics. Some of these unique characteristics are positive business attributes such as flexibility, independency, informality, innovative behaviour, operation possibilities on slim margins, high motivation of employees, short decision-making chains, and negative attributes such as limited financial, managerial, human and i...