zara amazing logistics
ZARA’ AMAZING logistics
Introduction
Zara is the world’s largest apparel retailer. Its rapid growth is considered to be benefit from its strategy that can be highly responsive to changing trends with affordable price. It is claimed that design-to-sales cycle times is ten times less than traditionally averaged. At the following text, there is some report and analysis about Zara’s advantage in competition, why it choose to have both in-house and outsourced production, why produce the clothes with uncertain demand in local manufactures and the clothes with predicted demands in Asian manufacturers, what’s the advantage it gain from replenishing its stores multiple times a week and the technologies Zara need to operate its every processes in design-to-sales.
Q1:
Contrast with the strategy of the other apparel retailers—“The first world fashion in the third world factory production”, Zara get the core advantage of 15-days lead-times by its rapid supply chain model. The rapid supply chain model brings Zara three main benefits:
It enhances customer satisfaction. Zara has such a short design-to-sales cycle time and every style has only little production that customer could be at ease that they will not wear the same dress with the stranger on the street. A research showed that every customer of Zara visits Zara averagely 17 times in a year, while that of other apparel retailer only have 4 times (Gallaugher J.M, 2008)
Zara’s rapid supply chain keep the whole supply chain in its control, eliminated the bullwhip effect caused by forecasting updating, limited supply and short-term game. In addition, it take the order way of “little quantity and frequent delivery “, and the order is made on the basis of the current sale and demands reported by store managers. This ordering method can eliminated the bullwhip caused by bulk supply. Reducing the bullwhip, on the hand, it helps Zara to predict customers’ demands more accurately. On the other hand, it decreases its
Introduction
Zara is the world’s largest apparel retailer. Its rapid growth is considered to be benefit from its strategy that can be highly responsive to changing trends with affordable price. It is claimed that design-to-sales cycle times is ten times less than traditionally averaged. At the following text, there is some report and analysis about Zara’s advantage in competition, why it choose to have both in-house and outsourced production, why produce the clothes with uncertain demand in local manufactures and the clothes with predicted demands in Asian manufacturers, what’s the advantage it gain from replenishing its stores multiple times a week and the technologies Zara need to operate its every processes in design-to-sales.
Q1:
Contrast with the strategy of the other apparel retailers—“The first world fashion in the third world factory production”, Zara get the core advantage of 15-days lead-times by its rapid supply chain model. The rapid supply chain model brings Zara three main benefits:
It enhances customer satisfaction. Zara has such a short design-to-sales cycle time and every style has only little production that customer could be at ease that they will not wear the same dress with the stranger on the street. A research showed that every customer of Zara visits Zara averagely 17 times in a year, while that of other apparel retailer only have 4 times (Gallaugher J.M, 2008)
Zara’s rapid supply chain keep the whole supply chain in its control, eliminated the bullwhip effect caused by forecasting updating, limited supply and short-term game. In addition, it take the order way of “little quantity and frequent delivery “, and the order is made on the basis of the current sale and demands reported by store managers. This ordering method can eliminated the bullwhip caused by bulk supply. Reducing the bullwhip, on the hand, it helps Zara to predict customers’ demands more accurately. On the other hand, it decreases its