Zara

Topics: Supply chain management, Inditex, A Coruña Pages: 23 (3897 words) Published: December 12, 2014

TBS933 - Procurement Management
Lecturer Dr. Wafa AbuSnaineh

By: Amgad Radwan (4814940)
Khouloud Ghazouani
Meriam Afitou
Nadeem

 Autumn 2014

Table of Contents
I.INTRODUCTION3
1. Company Background3
Vision and Mission3
II.Situation Analysis:5
1. The Strengths-Weaknesses-Opportunities-Threats (SWOT) Analysis9 III.Success Factors of ZARA10
1. Fast Production10
2. Use of Information Technology.11
3. lower inventory12
4. A centralized distribution system12
5. Suppliers12
IV.Issues and recommendations13
1. Issues and Challenges:14
2. Solutions& Recommendations:16
V.Implementation and Road Map:18
VI.Conclusion20
VII.References:21

I. INTRODUCTION
1. Company Background
Zara is a Spanish brand of clothing founded by Amancio Ortega Gaona and Rosalia Mera in Artexio, Galicia. Zara was founded in the year 1975. It is one of the major selling brands of one of the biggest fashion retailer "INDITEX". Zara is now available in 88 countries with total of 2,026 stores worldwide. http://www.inditex.com/en/our_group/international_presence Inditex itself is a huge fashion retailer company which owns 8 brands namely Zara, Bershka, Stradivarius, Pull &Bear, Oysho, Massimo Dutti, Zara Home and last but not the least Uterque. Amancio Ortega is the founder of Inditex, which was established in 1963. Amancio Ortega adapted unique business model, which were innovative and flexible. This made Inditex one of the biggest retailers in the world. In 1975 Inditex established Zara’s first store in downtown A Coruna, Spain. Zara offers fashionable designs for men, women, and kids. They also sell accessories to complete their product lines. Vision and Mission

The company’s vision as stated on the website “Zara is committed to satisfy the desires of our customers. As a result we pledge to continuously innovate our business to improve your experience. We promise to provide new designs made from quality materials that are affordable”. http://www.zara.com/ae/en/company/

Zara states that its mission is that “Through Zara’s business model, we aim to contribute to the sustainable development of society and that of the environment with which we interacts”. Zara has succeeded to be one of the world’s largest brands. They are expanding in many emerging markets and continue success in the existing markets. Zara’s customers love how fast Zara replenish new and good designs. Zara is placed the highest among other customer-favorite brands (as shown on Figure 1) which shows the loyalty of Zara’s customers. Zara has succeeded to achieve their vision through satisfying their customers. Further, in case of their mission, it shows Zara direction toward the environment. We think that Zara is getting there through their long term objectives and their current eco-friendly strategies in order to achieve their mission.

Figure 1 Value of a Fan: Across Brands 2013
Source: Syncapse 2013
http://www.syncapse.com/value-facebook-fan-consumer-brands-174/#.VHIvtvmUfCQ The company states on their website the following as their objectives in the long-term: Through Zara’s business model, they aim to contribute to the sustainable development of society and that of the environment with which we interact. The company's commitment to the environment is included in Inditex Group’s Corporate Responsibility Statement, published on our website: www.inditex.com. Zara supports organic farming and makes some of its garments out of organic cotton (100% cotton, completely free of pesticides, chemicals and bleach). They have specific labels and are easy to spot in our shops. Zara's fleets of lorries, which transport more than 200 million items of clothing a year, use 5% biodiesel fuel. This allows us to reduce our CO2 emissions by 500 tons. II. Situation Analysis:

Zara supply chain is based on 4 main stages: Design, production, distribution and...

References: Baigorri, M. ( 2009). ZARA looks for Asia for Growth, Bloomberg Business week.
Tokatli, N. ( 2007). Global sourcing: insights from the global clothing Industry, the case of Zara, a fast fashion retailer. Journal of Economic Geography 8 pp. 21–38
Monczka, Handfield, Giunipero, & Patterson. (n.d.). World Wide Sourcing. In Purchasing & Supply Chain Management (4th ed.).
Tokatli, N. (2007). Global Sourcing: Insights from the global clothing industry-the case of Zara, a fast fashion retailer. Economic Geography,8.
Mihm, B. (2010). Fast Fashion In A Flat World: Global Sourcing Strategies. The International Business & Economics Research Journal.
Carugati, A., Liao, R., & Smith, P. (2008). Speed-to-Fashion.
http://www.inditex.com/en/our_group/international_presence
http://www.zara.com/ae/en/company/
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