The History of the Fashion Store Zara

Topics: Marketing, Inditex, Retailing Pages: 8 (2193 words) Published: August 11, 2011
            Inditex, one of the worlds largest fashion distributors, has eight major sales formats - Zara, Pull and Bear, Massimo Dutti, Bershka, Stradivarius, Oysho, Zara Home y Kiddy's Class- with 3.147 stores in 70 countries around the world.             Inditex Group is comprised of over one hundred companies associated in textile design, manufacturing and distribution. The achievements of the company and the uniqueness of its management model, which is based on innovation and flexibility, made Inditex one of the largest fashion distribution groups in the fashion industry.             The company’s fashion philosophy -creativity and quality design together with a rapid response to market demands- has resulted in fast international expansion and excellent response to sales concepts.             The first Zara shop opened in 1975 in A Coruña (Spain), the city that saw the Group's early beginnings and which is now home to its central offices. Its stores can now be found in the most important shopping districts of more than 400 cities in Europe, the Americas, Asia and Africa             As of today, Inditex is probably the fastest growing fashion retailer in the world, with over 3,100 stores, in over 70 countries around the world, and Zara is around 1,000 of those stores. Zara, as a member of the one worlds largest fashion distributor, has a high response when it comes to their supply chain. Latest fashion designs are easily supply to all the stores/branches of Zara worldwide, in just a matter of two weeks. Vertical Supply Chain             Zara operates using a vertical supply chain, which is a unique strategy in the fashion industry. Vertically integrated business undertakes a variety of activities from designing, manufacturing, sourcing, and to distribution to retail stores around the world. A company that operates in a vertically integrated strategy has total control of various business activities, such as designing, manufacturing, sourcing, and to distribution to retail stores. This gives the company total business management.             “While retailers concentrate their money and efforts on building a brand image through advertising campaigns, their lack of control over sub-contractors has left many open to accusations of using sweatshop labour when unacceptable practices are uncovered at factories producing their merchandise.”                  Zara is driven by introduction of new designs and releasing new products in just a short time. The strategy is to produce and release products in number or limited in a store, a store may only receive ten of the new product. This strategy closely emulates a ‘make to order environment’. The idea is releasing a design in limited number or exclusive. This strategy this builds up customer’s anticipation of the next product or design to be release, making the next product highly anticipated by customers.             Zara does not focus in advertising their product, because Zara does not focus in building brand image, there target is production and the customer’s anticipation of their product. Instead on focusing their strategy in product advertisement, the company focuses on product design and quality.             Below is a supply chain barometer of Zara, this supply chain barometer shows the balance between the company’s in-house and external operations. The balance in fabric supply and manufacturing of the product itself contributes in the company’s success. Not all the company’s in-house resources are use. A large percentage of the company’s fabric supplies are use in other brands. While in manufacturing, Zara has the most products manufactured.    

            All the products of Zara are transported from the company’s main central site in Spain. Most of the products are shipped from the “A Coruña depot” (Zara Logistica). All stocks are not held for long periods and are sent out to all the Zara stores twice a week.  For international deliveries, the stocks...
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