Professional Documents
Culture Documents
Ann Mary
Arpit Nim
Arjun T S
Jeeth Raju
Mohsin Mohamad
Supply chain:
Organized to transfer data quickly from shoppers to designers and production staff.
Constant exchange of information throughout every part of the supply chain mitigates the
so-called bullwhip effect (the tendency of supply chains to amplify small disturbances).
Inventory management: The stock delivered is strictly limited, ensuring that each store only receives
just want they need. This goes towards the brand image of being exclusive while avoiding the build
up of unpopular stock.
Reducing Risks: the less its availability, the more desirable the object becomes.
Strong Distribution network: enables the company to deliver goods to its European stores within 24
hours, and to its American and Japan outlets in less than 48 and 72 hours respectively.
Fast fashion success: its vertically integrated supply chain, enables limited production under control,
leading to well managed inventories, lower markdowns, higher profitability, and value creation for
shareholders in the short and long term.
Synergy between business and operations strategy: Extensive market research paired up with
cutting edge IT, let them manage the huge variety product portfolio easily.
Strengths Weaknesses
1.Cost leadership strategy 1.Zara only has one manufacturing and
distribution centre in the world
2.Efficient distribution
2.Doesn't spend much money on
3.Information technology advertising
4.Fast delivery of new products ,and 3. Limited stocks and removing the
trends unsold items within 2-3 weeks , piles
up on inventory
SWOT
Analysis
Opportunity Threats
1.Global market penetration 1.Local competitors
2.Increase in Outsourcing for expansion 2.Global competitors
in Asian countries. 3. Zara based in Spain and has a huge no
3.Opting for Omni channel mode of of stores in Europe, and exchange rate
Distribution fluctuations may dent its revenues.
Conclusion
Vertical Integration: It manages design, production, shipment, display, promotion, sales, and feedback itself,
relying only diminutively on outsourcing
Limited Production: The logic behind this is that small lot creates the sense of exclusivity. Customer need to make
a quick decision otherwise the next day the products they want will be gone. So customer visits Zara's stores to
see new products more often and this creates the huge amount of traffic and revenue.
Centralize design and product development: Stream lining the back-and-forth communication between store
managers, market specialists and other eminent heads reduces the time to understand market needs drastically.
Control scheduling strictly: At Zara, store managers can place order 2 times a week, shipments are prepared and
delivered within 24 hours (in Europe) and products will be on displayed at stores the same day they arrived. Since
everything runs in a stead pace, they can reduce a waiting time at every step of the way.
Automate production and warehouse facilities : Zara believes in time based competition, automation is the key
to help them to increase the speed and the accuracy of the operations.
Adhere to all rules: Implementing any one of these rules alone is not quite effective. Then, they have to stick to
all rules so the whole supply chain is running like the well-oiled machine.
Thank You