Professional Documents
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ZARA
Inventory Management at
Inventory Management at
Short shelf life attracts
more customers more
often
Stock outs are not
uncommon
Zara holds 6 days worth of
inventory, while H&M
holds 52 days, and Spanish
retailer Cortefiel holds 94
days of inventory
How it Works ?
Suppliers are all
close to their
factories so ZARA
can order on a
need-basis
This enabled ZARA to establish a business model that allows selfcontainment throughout the stages of materials, manufacture,
product completion and distribution to stores worldwide within just
a few days.
ZARA - The vertical integration of our production system allows
us to place a garment in any store around the world in a period
between two to three weeks.
Design and
Order Administration
The company ensure product quality by
designing its own products. Zara has almost
300 people working in its headquarters in
Spain.
These talented people include designers
and specialists. Together they produce
designs for approximately 40,000 items per
year from which 12,000 are selected for
production.
Production
50% of the products Zara sells are manufactured in
Spain, 26% in the rest of Europe, and 24% in Asian
and African countries and the rest of the world.
Zara makes its most
fashionable items half of
all its merchandise at a
dozen company owned
factories
in
Spain
andPortugal, particularly
in
Galiciaand
northernPortugalwhere
labour
is
somewhat
cheaper than in most of
Western Europe.
Distribution
Distribution Centre all products pass through
Zaras major distribution centre in La Corua. The
5-storey, 50,000 square meter distribution centre
employs some of the most sophisticated and up-todate automated systems.
Logistics
(Contractors) In 2012, the
distribution centre shipped 130 million pieces. 75
percent of these shipments were to stores in
Europe. Fashion garments represent around 80
percent of Zaras products and the rest are more
basic items.
Retailing
Stores usually place their orders and receive shipments
twice per week. Orders have to be placed at predesignated times.
The overall experience of the customer in the store in
considered. Apart form the fashion supply, the interior
maximum
design of the store, coordination of collections,
care over window displays and customer care are some
of the elements that guarantee this experience.
Conclusion
Zara is an example of how a firm can design and
manage its supply chain to gain competitive
advantage.
Zara makes sure that each element of the supply
chain network adds value to the entire operation.
References
http://www.supplychainforum.com/documents/articles/Zara%20Case
%20Study%20.pdf
www.businessweek.com%2Farticles%2F2013-1114%2F2014-outlook-zaras-fashion-supply-chainedge&ei=pE0AVL6wCYmLuAShqoKgDg&usg=AFQj
CNEGEVmiebxJ4wDUuIFG-yJiZb-EQA
http://www.zara.com/in/
http://en.wikipedia.org/wiki/Zara_(retailer )
https://www.youtube.com/watch?v=9n0mikF1Esw
Thanks