Zara, Fast Fashion
The global apparel market is a buyer-driven market. Along with the globalization and technology development, consumers are easier to access to fashion. As a result, the customers are changing and the companies are evolving to deliver customers satisfaction. Zara, the most profitable brand of Spain clothing retail group Inditex, has leveraged its unique strategy to achieve success and will be expected to maintain a sustainable growth in the fashion industry.
Zara’s core competencies can be divided into four areas: process development, distribution, marketing and integrated business structure (referred to Appendix 1). Zara’s unique process development allowed Zara to produce in a shorter cycle time and more quickly response to the customer’s needs than other competitors. When the fashion season started, Zara’s designers attended trade fairs and ready-to-wear fashion shows to translate the latest trend of fashion into their design. Zara’s product development staff, at the meanwhile, researched the market through different retail stores and university campuses to understand customer’s preferences. Zara’s IT system, on the other hand, played a key role on the internal communications. This helped Zara’s managers constantly track the sales data and therefore capture the customer’s desire. Moreover, Zara’s centralized distribution facility gave the chain efficiency. Both internal and external products passed through the distribution center, and were inspected and shipped immediately. Then, to increase the delivery speed, Zara scheduled shipments by time zone. Products were shipped by truck or air and were usually delivered to worldwide stores within 24-48 hours. In contrast to other companies’ outsourcing activities, Zara’s in-house manufacturing created a rapid product turnover since its products were limited and the inventories were strictly controlled. This rapid turnover created an opportunity to Zara’s retail stores and a sense of scarcity that “buy now because you
Zara’s core competencies can be divided into four areas: process development, distribution, marketing and integrated business structure (referred to Appendix 1). Zara’s unique process development allowed Zara to produce in a shorter cycle time and more quickly response to the customer’s needs than other competitors. When the fashion season started, Zara’s designers attended trade fairs and ready-to-wear fashion shows to translate the latest trend of fashion into their design. Zara’s product development staff, at the meanwhile, researched the market through different retail stores and university campuses to understand customer’s preferences. Zara’s IT system, on the other hand, played a key role on the internal communications. This helped Zara’s managers constantly track the sales data and therefore capture the customer’s desire. Moreover, Zara’s centralized distribution facility gave the chain efficiency. Both internal and external products passed through the distribution center, and were inspected and shipped immediately. Then, to increase the delivery speed, Zara scheduled shipments by time zone. Products were shipped by truck or air and were usually delivered to worldwide stores within 24-48 hours. In contrast to other companies’ outsourcing activities, Zara’s in-house manufacturing created a rapid product turnover since its products were limited and the inventories were strictly controlled. This rapid turnover created an opportunity to Zara’s retail stores and a sense of scarcity that “buy now because you