Zara's Supply Chain Strategy
Zara is a Spanish apparel manufacturer which introduced the concept of fast fashion and revolutionized the world of fashion. The company offers fashionable items at affordable prices and relies on diversification and vertical integration. The supply chain strategy is based on the velocity and accuracy of Zara’s distribution and is supported by the core competencies of the firm. The structure of the supply network itself contributes to the execution of the strategy. In particular, the ownership of the production sites in Europe creates a flexible supply chain. Therefore, the designers are able to react quickly to evolving trends and to customer demand. Moreover, the constant information flow between the headquarters and the retail stores is …show more content…
Secondly, the report elaborates on the supply chain strategy of Zara and its implications on interplay of the business and supply chain strategy, the structure of the supply chain network and our core competencies. Thirdly, the internal production process is discussed including the design and manufacturing process. In addition, the capacity and inventory management is analyzed. Fourthly, the report looks at the external supply chain which consists of the supplier selection and relationships, the logistics, forecasting and the customer contact. Lastly, a conclusion is drawn on what the key success factors of Zara …show more content…
Therefore, Zara’s control over nearly the entire supply chain is a substantial part of its competitive advantage. 4 SUPPLY CHAIN STRATEGY OF ZARA
The business strategy of Zara has given the company a long lasting, sustained competitive advantage. In a highly competitive industry like the apparel industry, a company needs to be structured and flexible concurrently, in order to translate its resources into a promissory concept. Even though, one of the key virtues of Zara is its subtle supply chain strategy the company will have to continuously improve its operations. Otherwise, future challenges like the increasing level of global expansion, the rising prices of oil and raw materials or mass competition could lead to the loss of Zara’s superior performance.
4.1 Interplay of the Business Strategy with the Supply
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