Zara: It for Fast Fasher

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Inditex is a huge fashion retailer that has done well by focusing on three key issues, reduction of lead time, dissemination of information through worker involvement, and vertically integrating its complex lines and k i l t d ti ll i t ti it l li d outsourcing its simple ones. Inditex supply chain, links product design, manufacturing and delivering the final product to the consumer with short lead time. Zara is one of Inditex’s biggest retail fashion chain stores with over 600 stores worldwide. In the early 2000, Zara was faced with the decision to upgrade or not to upgrade its DOS operating system which is has become obsolete. The challenge to the company is to upgrade and be faced with the fear of loosing i l l i its leverage and all the i d ll h intangibles and advantages that they ibl d d h h have acquired over the years. If they do not upgrade, the company faces the possibility that their operating system will not be supported by the manufacturer also any future improvements may not be compatible with Zara’s current system. y Our decision is that Zara should upgrade the operating system and POS system, since MS DOS is an outdated OS and hardware is becoming less compatible.

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Outdated Operating System (POS System)  Manual Inventory  Lack of communication (between stores & handhelds h dh ld to the POS) h  The Unknown (Of a knew Operating System)  Produce in house or to outsource?  Advantages of reduced lead time in the supply chain chain. 

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Vertical Integration
Majority of the production is controlled and owned by a single company Zara:  Manages the company through their commercials (individual management teams).  Managers complete all the designs designs, warehousing & logistics/integration •

Outsourcing Receiving goods/services from an outside supplier Zara  Simpler products like sweater & products, classic colours are outsourced  Quick turn around time which allows them to keep to a strict distribution schedule •...
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