Steven A. Shapiro
European clothing retailer Zara has been highlighted in several publications as a model for its supply chain management. This retail chain exists as a subsidiary of “Spain’s largest apparel manufacturer and retailer” (Chopra & Meindl, 2012, p.14). The most telling account of Zara’s success is detailed in an article for Harvard Business Review entitled, ‘Rapid-Fire Fulfillment’. Here, authors Ferdows, Lewis and Machuca (2004) describe three key principles that Zara relies on to maintain its success… * Close the communication loop
* Stick to a rhythm across the entire chain
* Leverage your capital assets to increase supply chain flexibility (Ferdows, et al., 2004) The first of these principles, ‘Close the communication loop’, outlines the processes by which information is transferred quickly between its valuable customer base and the designers. This open and nimble communication allows Zara to have a better understanding of the pulse of its customers; which in turn, allows the company to stock its stores with clothing the customer wants when they want it.
The next principle, ‘Stick to a rhythm across the entire chain’ is outlined by Ferdows, et al. (2007) when they wrote, “at Zara, rapid timing and synchronicity are paramount” (p. 107). The authors go on to highlight the rigidness by which Zara holds its retail stores to time-bound deadlines for things like product ordering. Missing a deadline is highly frowned upon and can result in a retail store losing that opportunity to obtain additional products.
The third principle, ‘Leverage your capital assets to increase supply chain flexibility’ is fairly self-explanatory. The concept is that Zara funds the supply chain not only to run at an efficient manner with their in-house processes, but it outsources the easier parts of the processes as well. The authors of the article write, “[Zara] produces complicated products...