Forget football stars, the Costa del Sol and Real Madrid, they are nothing compared with Zara as Spain’s most successful international export. And it has other retailers reeling as Zara’s low-cost, fast fashion takes global markets by storm. This dynamic retailer is known for selling stylish designs that resemble those of big-name fashion houses but at moderate prices. ‘We sell the latest trends at low prices, but our clients value our design, quality and constant innovation,’ a company spokesman said. ‘That gives us the advantage even in highly competitive, developed markets, including Britain. More interesting is the way that Zara achieves its mission. Fast fashion – the newest wave A handful of European speciality clothing retailers are taking the fashion world by storm with a business model that has come to be known as ‘fast-fashion’. In short, these companies can recognise and respond to fashion trends very quickly, create products that mirror the trends, and get these products onto shelves much faster and more frequently than the industry norm. Fast-fashion retailers include Sweden’s Hennes & Mauritz (HM), Britain’s Top Shop, Spain’s Mango and the Netherland’s Mexx.
Although all of these companies are successfully employing the fast-fashion concept, Zara leads the pack in virtually every way. For example, ‘fast’ at Zara means that it can take a product from concept through design, manufacturing and store shelf placement in as little as two weeks, much quicker than any of its fastfashion competitors. For more mainstream clothing chains such as Gap and Next, the process takes months. This gives Zara the advantage of virtually copying fashions from the pages of Vogue and having them on the streets in dozens of countries before the next issue of the magazine even hits the newsstands!
The Term Paper on Emerging Retail Trends In India
India represents an economic opportunity on a massive scale, both as a global base and as a domestic market. Indian Retail sector consists of small family-owned stores, located in residential areas, with a shop floor of less than 500 square feet. At present the organized sector accounts for only 2 to 4% of the total market although this is expected to rise by 20 to 25% by next 3 years. Retail ...
When Spain’s Crown Prince Felipe and Letizia Ortiz Rocasolano announced their engagement in 2003, the bride-to-be wore a stylish white trouser suit. This raised some eyebrows, given that it violated royal protocol. But women loved it and within a few weeks, hundreds of them were wearing a nearly identical outfit they had purchased from Zara. 1 Kotler P. et al, (2008), Principles of Marketing, 5th European edition, Harlow, Pearson Education Ltd. But Zara is more than just fast. It’s also prolific. In a typical year, Zara launches about 11,000 new items. Compare that to the 2,000 to 4,000 items introduced by both H&M and Gap.
In the fashion world, this difference is huge. Zara stores receive new merchandise two to three times each week, whereas most clothing retailers get large shipments on a seasonal basis, four to six times a year. By introducing new products with frequency and in higher numbers, Zara produces smaller batches of items. Thus, it assumes less risk if an item doesn’t sell well. But smaller batches also mean exclusivity, a unique benefit from a mass-market retailer that draws young fashionistas through Zara’s doors like a magnet. When items sell out, they are not restocked with another shipment.
Instead, the next Zara shipment contains something new, something different. Popular items can appear and disappear within a week. Consumers know that if they like something they must buy it or miss out. Customers are enticed to check out store stock more often, leading to very high levels of repeat patronage. But it also means that Zara doesn’t need to follow the industry pattern of marking prices down as the season progresses. Thus, Zara reaps the benefit of prices that average much closer to the list price. The vertical secret to Zara’s success Just how does Zara achieve such mind-blowing responsiveness?
The answer lies in its distribution system. In 1975, Amanco Ortega opened the first Zara store in Spain’s remote north-western town of La Coruna, home to Zara’s headquarters. Having already worked in the textile industry for two decades, his experience led him to design a system in which he could control every aspect of the supply chain, from design and production to distribution and retailing. He knew, for example, that in the textile business the biggest mark-ups were made by the wholesalers and retailers. He was determined to maintain control over these activities.
The Essay on End-to-End Argument In System Design
In our your submission you need to briefly summarize the main idea(s) and contribution(s) of the paper. In particular, your review needs to address the following: 1. Discuss the three most important things the paper advocates, 2. Discuss the most glaring problem(s) with the paper, and 3. The paper was written with the design of the original Internet in mind. Discuss what impact, if any, may the ...
Ortega’s unique philosophy forms the heart of Zara’s unique, rapid-fire supply chain today. But it is Zara’s hi-tech information system that has taken vertical integration in the company to an unprecedented level. According to CEO Pablo Isla, ‘Our information system is absolutely avant-garde. It’s what links our shop to our designers and our distribution system. ’ Zara’s vertically integrated distribution system makes the starting point of a product concept hard to nail down. At Zara’s headquarters creative teams of over 300 professionals carry out the design process. But they act on information fed to them from the stores.
This goes far beyond typical pointof-sales data. Store managers act as trend spotters. Every day they report hot fads to headquarters, enabling popular lines to be tweaked and slow movers to be whisked away within hours. If customers are asking for a rounded neck on a vest rather than a V neck, such an item can be in stores in seven to ten days. This process would take traditional retailers months. Managers also consult a personal digital assistant every evening to check what new designs are available and place their orders according to what they think will sell best to their customers.
Thus, store managers help to shape designs by ensuring that the creative teams have real-time information based on the observed tastes of actual consumers. Mr Ortega refers to this as the democratisation of fashion. 2 Kotler P. et al, (2008), Principles of Marketing, 5th European edition, Harlow, Pearson Education Ltd. When it comes to sourcing, Zara’s supply chain is unique as well. Current conventional wisdom calls for manufacturers in all industries to outsource their goods globally to the cheapest provider. Thus, most of Zara’s competitors contract out manufacturing to low-wage countries, notably Asia.
The Research paper on Job Analysis Assistant Store Managers As Today's Fashion
She was recently promoted to the position of regional sales manager for today;s fashion ,A national chain of speciality clothing stores with 200 outlets across the country marry is the regional manager for the pacific coast. one of today’s fashion’s largest markets. she manages 35 outlets in California. The outlets have a store manager reports to directly to marry. Each outlet has between three ...
But Zara makes 40 per cent of its own fabrics and produces more than half of its own clothes, rather than relying on a hodgepodge of slow-moving suppliers. Even things that are farmed out are done locally in order to maximise time efficiency. Nearly all Zara clothes for its stores worldwide are produced in its remote corner of Spain. As it completes designs, Zara cuts fabric in-house. It then sends the designs to one of several hundred local cooperatives for sewing, minimising the time for raw material distribution.
When items return to Zara’s facilities they are ironed by an assembly line of workers who specialise in a particular task (lapels, shoulders, and so on).
Clothing items are wrapped in plastic and transported on conveyor belts to a group of giant warehouses. Zara’s warehouses are a vision of modern automation as swift and efficient as any automotive or consumer electronics plant. Human labour is a rare sight in these cavernous buildings. Customised machines patterned after the equipment used by overnight parcel services process up to 80,000 items an hour.
The computerised system sorts, packs, labels and allocates clothing items to every one of Zara’s 1,000 plus stores. For stores within a 24 hour drive, Zara delivers goods by truck, whereas it ships merchandise by cargo jet to stores farther away. Domestic manufacturing pays off The sae philosophy that has produced such good results for Zara has led parent company Inditex to diversify. Its other chains now include underwear retailer Oysho, teen-oriented Bershka and Stradivarius, children’s Kiddy Class, menswear Massimo Duti and casual and sportswear chain Pull and Bear.
Recently Inditex opened its first non-clothing chain, Zara Home. Each chain operates under the same style of vertical integration honed at Zara. Making speed the main goal of its supply chain has really paid off for Inditex. In 2005, sales grew by 21 per cent over the prior year to €6Bn (retail revenue growth worldwide averages single-digit increases).
The Essay on Retail Supply Chain Management
Block: 1 Unit: 1. Introduction to Retail Supply chain, Supply Chain and Logistics, Elements of Supply Chain and Elements of Logistics, Retail Logistics and Retail Supply Chain, Elements of Retail Supply Chain 2. Category Management: Introduction, Category Management Process, Components of Category Management, Challenges in Category Management 3. Merchandising, Types of Merchandise, Merchandise ...
That puts Inditex ahead of H&M in the fast-fashion category for the first time. During the same period profits soared by b26 per cent to $712m. Most of this performance was driven by Zara, now ranked number 73 on Interbrand’s list of top 100 most valuable worldwide brands.
Although Inditex has grown rapidly, it only wants more. In 2005, it opened 448 new stores (H&M added only 145) and had plans for 490 more. With more than one ribbon cutting ceremony per day, Inditex could increase its number of stores from the current 2,900 to as many as 5,000 stores in 70 countries by the end of this decade. After European clothing stores , including Marks & Spencer, fared badly in the US, European fastfashion retailers have recently expanded very cautiously in the US (Zara has only 19 stores there so far).
But the threat of Zara has US clothing retailer rethinking the models they have relied on for years.
According to one analyst, the industry may soon experience a reversal from outsourcing to China to manufacturing in America, despite its relatively high costs. 3 Kotler P. et al, (2008), Principles of Marketing, 5th European edition, Harlow, Pearson Education Ltd. ‘US Retailers are finally looking at lost sales as lost revenue. They know that in order to capture maximum sales they need to turn their inventory much quicker. The disadvantage of importing from China is that it requires a longer lead time of between three to six months from the time an order is placed to when the inventory is stocked in stores.
By then the trends may have changed and you’re stuck with all the unsold inventory. If retailers want to refresh their merchandise quicker, they will have to consider sourcing at least son me of the merchandise locally. ’ So being the fastest of the fast-fashion retailers has not only paid off for Zara, its model has reconfigured the fashion landscape everywhere. Zara has blazed a trail for cheaper and cheaper fashion-led mass retailers, has put the squeeze on mid-priced fashion, and has forced luxury brands to scramble to find ways to set themselves apart from Zara’s look-alike designs.
Leadership certainly has its perks. Questions 1. As completely as possible, sketch the supply chain for Zara from raw materials to consumer purchase. 2. Discuss the concepts of horizontal and vertical conflict as they relate to Zara? 3. Which type of vertical marketing system does Zara exhibit? List all the benefits that Zara receives by having adopted this system. 4. Does Zara incur disadvantages from its fast-fashion distribution system? Are these disadvantages offset by the advantages? 5. How does Zara add value for the customer through major logistics functions?
The Essay on Style Shop Store Computer Inventory
Abstract The purpose of this report is to determine whether it would be feasible for the Style Shop to add a computerized register to the store. The Merchandising Society is the largest club on F. I. T.'s campus. It provides the opportunity for its members to enhance their college experience at the Fashion Institute of Technology. Its members are dedicated to gaining exposure to the fashion ...
