The hybrid model results into well managed inventoriesreduced costs from obsolete products, linkages between supply and demand, nevertheless, there is still room for upgrading in their IT processes to realize more reliable management of inventory levels.
A point-of sale POS system is used in the stores and the information gathered Zara case study operational management sent to Inditex.
Also, the POS technology has allowed to tight up the links between vendors and led to improvements in the ordering process, in deliveries and in the distribution system as a whole, thus contributing to increase the level of responsiveness of ZARA. ZARA chose to implement a Just-In-Time JIT manufacturing system as well as to invest in a sophisticated telecommunication system, thus improving the information flow between headquarters and supply, production and sales sites and thus avoiding any type of bureaucratic structure.
By so doing, the store managers assist shape designs. Securing a foothold in as many markets as possible with the intended outcome of building brand awareness and an increased market share has resulted in Zara developing their brand, launching Zara Home. The SKU system allows the gathering of data to help identifying and producing garments sought by customers, and in the right quantities, thus improving the ordering system at the distribution center.
The JIT system allows ZARA to improve qualityto diminish manufacturing time, to eliminate wasteto increase productivity and to have better relationships between suppliers, thus improving its overall responsiveness. Their concentration on core operation as well as production capabilities, resistance to outsourcing, and focus on the fashion pulse have made this company one of the most victorious clothing retails.
Moreover, managers consult personal digital assistant on daily basis to check the availability of new designs and to place their orders to what they think will be much appreciated by their customers.
Opting for a strategy of minimal advertising provokes the consumer into having to visit their stores. Coupled with this, is their keen eye for discovering new fashion trends and translating these trends from the catwalk to the high street, both quickly and affordably.
Information and communication protocols at Zara are radically different from its competitors. This differs from their competitors who spend about 2 percent of their total revenue on information technology and have 2. Today the Zara name is recognized throughout the entire world.
Zara opened their first store in Spain in and have since expanded internationally, opening their first international store in Portugal inand later opening a further store in New York, US, in A high-tech mobile tracking system speeds up the distribution system by proceeding high numbers of garments in a short period of time, thus minimizing intervention of labor force while increasing productivity.
This technology contributes without doubt to ameliorate the responsiveness of ZARA: Finally, store location, as any marketing is left to store location rather than advertising.
Zara also made considerable investments to improve its logistics system and to develop its IT infrastructures. Zara makes use of human intelligence and information technology such as their PDA devices to come up with a hybrid model for flow of information from stores to the headquarters.
The company spends less than 0. Zara boasts a marketing strategy of firstly product variety with a focal point of ensuring speed to market. Use of Technology to Improve Operational Responsiveness Identification of fashion trend at Zara is part of the culture. As garments did not stay for a long time in the warehouse, the company is able to cut down storage costs.
At present, Zara launch 10, new articles per year across their portfolio of stores. Furthermore, this system allows ZARA to take appropriate and quicker decisions due thanks to the information flow being very fluent.
Grupo Inditex is formulated by an amalgamation of major high street names from across Europe, including Zara, Pull and Bear and Bershka, in total boasting stores across 68 countries. ZARA, then, successfully maintain control of its inventory while keeping inventory costs at a lower level.
Case Study of Zara:case STUDY Zara is the flagship brand of the Spanish retail group, Inditex SA, second and third day it starts to look stale, but customers may. In the case of Zara, for European, American, and eastern Asian countries, Zara is positioned as the low-end 13 products, however, in emerging markets such as India, China, and Indonesia, Zara is considered as the high-end products.
Case Study of Zara: Use of Technology to Improve Operational Responsiveness Fashion giant, Zara, forms part of the retail group ‘Grupo Inditex’ which is one of the “largest, fastest growing and successful” clothing retailers across Europe.
Zara's case study will be used, as an example, considered to be the pioneer in fast fashion industry nowadays.
The section following this. As described in a case study of Zara’s supply chain, the company is vertically integrated, controlling most of the processes in its supply chain.