Success Factor for Zara
What are the Key success factors of Zara?
“The ability to respond to customer requirements on a timely basis has always been a fundamental element of the marketing concept.” Martin Christopher et.al. Hence, it is important being proactive in a market such as the fast-fashion industry which Zara is operating in, time is always a crucial factor. The fast-fashion market, amongst other things, is characterized by short lifecycles, high volatility, low predictability, and high-impulse purchases. Therefore, it is very important for Zara to constantly have their products available for a potential customer in order to sell and earn more profit. Since the fast-fashion market is also constantly shifting and trends can be replaced over a night, there is a low predictability. This makes it a lot more difficult to compose accurate forecasts. In order to stay competitive in the market, it is important to take be aware of these types of factors mentioned above, and make sure you are not left behind.
One of Zara´s distinctive key success factors is their valuable and planned integrated logistics and supply chain management. This allows them to further develop and deliver a competitive marketing mix. In a marketplace where customers expect to find the latest designs that are still in fashion, Zara is an outstanding example of how to make that possible. It usually takes at least six months in the textile industry for an idea to be transformed into a product and reach the store shelves. By reducing the lead-time through efficient channel management, Zara has developed a vertical integrated business model, which allows them to change some parts of their inventory in only a couple of weeks.
This strategy is nowadays known as the “Quick Response” (QR). The definition of QR can be described as; “A state of responsiveness and flexibility in which an organization seeks to provide a highly diverse range of products and services to a customer/consumer in the exact quantity, variety,
“The ability to respond to customer requirements on a timely basis has always been a fundamental element of the marketing concept.” Martin Christopher et.al. Hence, it is important being proactive in a market such as the fast-fashion industry which Zara is operating in, time is always a crucial factor. The fast-fashion market, amongst other things, is characterized by short lifecycles, high volatility, low predictability, and high-impulse purchases. Therefore, it is very important for Zara to constantly have their products available for a potential customer in order to sell and earn more profit. Since the fast-fashion market is also constantly shifting and trends can be replaced over a night, there is a low predictability. This makes it a lot more difficult to compose accurate forecasts. In order to stay competitive in the market, it is important to take be aware of these types of factors mentioned above, and make sure you are not left behind.
One of Zara´s distinctive key success factors is their valuable and planned integrated logistics and supply chain management. This allows them to further develop and deliver a competitive marketing mix. In a marketplace where customers expect to find the latest designs that are still in fashion, Zara is an outstanding example of how to make that possible. It usually takes at least six months in the textile industry for an idea to be transformed into a product and reach the store shelves. By reducing the lead-time through efficient channel management, Zara has developed a vertical integrated business model, which allows them to change some parts of their inventory in only a couple of weeks.
This strategy is nowadays known as the “Quick Response” (QR). The definition of QR can be described as; “A state of responsiveness and flexibility in which an organization seeks to provide a highly diverse range of products and services to a customer/consumer in the exact quantity, variety,
References: Used the two articles posted by Dawn on FB Lectures Tutorials And: Retrieved on 2012-03-11http://www.google.com.hk/books?hl=sv&lr=&id=-9Ja0ZQ6gSMC&oi=fnd&pg=PA62&dq=market+orientation+and+supply+chain+management+in+the+fashion+industry&ots=0FiX4Yvyf5&sig=BoBe-KOlSiOaY6igTvN7NvyPVYM&redir_esc=y#v=onepage&q=market%20orientation%20and%20supply%20chain%20management%20in%20the%20fashion%20industry&f=false Retrieved on 2012-03-11 http://martin-christopher.info/wp-content/uploads/2009/12/CREATING-AGILE-SUPPLY-CHAINS-IN-THE-FASHION-INDUSTRY.pdf