Zara Supply Chain Analysis

what is supply chain management? Supply Chain Management is the strategic management and coordination of all traditional business functions within the supply chain, with the goal of increasing long-term performance and striving for customer satisfaction at the end point of delivery. Supply Chain Management is a cross-function approach that includes managing the movement of raw materials into the organisation, internal processing of materials into finished products, and the movement of finished products out of the organisation and toward the end-consumer. Effective Supply Chain Management involves business process integration, which demands collaboration between buyers and suppliers, joint product development, a homogeneous infrastructure, and shared information (Wailgum, 2008). At a high level, the supply chain consists of three types of flows: the product flow, the information flow, and the finances flow. The product flow is the movement of goods and products from suppliers to customers; the information flow involves the transmission and processing of orders and delivery status; and the finances flow entails processes such as payment processing and schedules, credit terms, and invoicing. The major activities encompassing the supply chain are design, planning, procurement, manufacturing, and fulfillment. The goal of Supply Chain Management is to make the flows as seamless as possible, reduce inventory, optimize transaction speed by exchanging data in real-time, and increase sales by implementing customer requirements more efficiently (iwarelogic.com, 2010). This essay will explore several key areas related to successful Supply Chain Management at Zara, a flagship chain store of Inditex Group based in A Coruña, Spain.

The Make-Buy decision

The make or buy decision entails choosing between manufacturing a product in-house or purchasing it from an external supplier. When making this decision, the two most important factors to consider are cost and

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