Zara Operation Strategy

Topics: Retailing, Supply and demand, Management Pages: 5 (1271 words) Published: September 1, 2014
Business Concept2
Four Perspectives of Operation Strategy2
Top-Down versus Bottom-Up Perspective3
Top-Down Perspective4
Bottom-Up Perspective4
Market Requirement versus Operations Resources4
Market Requirement Perspective5
Operation Resources Perspective5

Zara is a Spanish fashion and accessories retailers that founded in 1975 by Amancio Ortega and Rosalia Mera (Ledesma, 2013). Zara designs, manufactures their apparel, footwear and accessories for men, women and sells up-to-minute “fashionabilty” at low prices throughout Europe, US and Asia Pacific (Bilsel, 2014) that clearly focused on one particular market ( Nigel Slack, Stuart Chambers, Robert Johnston, Alan Betts, 2006)

Business Concept
The basic business concept of Zara is to maintain its design process, production and distribution that will allow Zara to respond quickly to changes in consumer demand by shipping new products to over 600 chains of Zara’s retail stores worldwide every few days (Tinataja, 2011) Zara's success is based on a business system that reaches a speed of response to market demand that is not without precedent in the sector of fast-pace fashion clothes trend. Zara cycle of design, production and distribution is significantly faster than any of its major competitors. For most fashion retailers have a period of six months between the completion of a new design and up to delivery at the retail store. Zara may have a new design from the drawing process to retail stores in as fast as three weeks (Grant, 2010). For example, it takes less than 2 weeks for a skirt from Zara’s team in Spain to be made and delivered to Paris or Tokyo – as much as 12 times faster than any competitors (CAvQM, 2013). Also, with shorter time notice, Zara can send fewer pieces of their clothes but in a variety of styles, and more than often they can easily cancel the lines that couldn’t sell so well to avoid inventory backlogs (Ozkurt, 2010) The design process does not seem to stop and designers are constantly evaluating consumer preferences. The staff working in Zara stores is mostly youngsters, who are very fashion-conscious and serve as the key "trend-spotter” (Singh, 2011 ) Four Perspectives of Operation Strategy

Operation Strategy is a strategic function. Basically, operation strategies related to the transition of inputs to outputs. Therefore, this strategy provides the basis for decisions on the operational level. Several expression domains of strategic activities designed products (tangible and intangible), supplier selection, the appropriate choice for the transition of the input and output factors, planning production planning, etc. (Mondal, 2013)

Top-Down versus Bottom-Up Perspective
According to the "top-down" approach, the overall business strategy establishing the general direction of the organization, which is then interpreted by the different functional areas of the company in their strategic function. In contrast, the "Bottom-Up" strategy is to view decision making as a strategy to accumulate practical experience. After all, the organization will find it difficult to 'invent' overall strategy in a vacuum. Their idea was formed from their previous experience dealing with customers, suppliers and their own processes. This is the idea behind the strategy well. This is the idea that strategy appeared over time as an organization begin to understand the reality of their situation.

Top-Down Perspective
Zara’s innovation idea and quick changing fashion trends has successfully capture the preference of buyers. Many users re-visit Zara stores often because the clothes and accessories are “updated” once a while, to fulfilled the desire of the trendy users. Zara target middle to upper class buyers as they have more disposable income who can afford the price of their clothing.

Bottom-Up Perspective
Zara pushes their innovation process in a rapidly...
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