Zara operating model

A case study on Zara

Contents

5. Distribution 6

6. Zara Online and Future 8

Introduction

The current report is going to discuss and analyse retailing, design, production/sourcing, distribution and also the online entity. A brief discussion is being added to reflect on the future of Zara which would create a forecast of the brand and its existence in the current market.

Retailing

As mentioned earlier Zara began with a single retail store for selling cancelled order products. The basic advantage the retails of Zara enjoy the location of the stores in prime selling locations. The locations are results of extensive survey and market study. The spacious selling layouts provide the customer with freedom, and experience of the uncluttered shopping experience (Willems, et al., 2012). The designs of the stores, windows as well as the furniture’s are the output of designer La Coruna and their flying team. Though it may seem simple, a store, its location and layout do have significance in providing the customers with the simple and comfortable shopping experience.

Design

A commercial team works behind the scenes for the designs which consist of designers and the market specialists and also the buyers. The team can generate 180,000 items every year, and around 10,000 of the items gets selected for the production and moves to the retail stores. Regarding men, women designs, the designers work in separate dedicated spaces which are organised by the products. The designing process is monitored by buyers as well as the country managers who sit around a table which helps to create a planned production for the company. Designers work with the designed with their hands (Wong, 2011). The final sketches are done using the CAD system which readjusts the changes, adjustments, matching weaves, cotton, colour and other aspects. However, it is determined before production whether the design would be factory produced and sold through the stores for profit-making purposes. A sample is created which is acquired from the sample creating centre located at the corner of the designing hall.

The designing process is a key factor as it creates the outline of the fashion, products and style which is going to be listed in the stores. Exclusivity, the ability of the products to match the customer expectation, and also meet with the competitors in the market are the key factors which a product has to fulfil when it hits the stores. The designing process is compartmental based on men; women and kids wear (Cachon & Swinney, 2011). The separate designing team works for each segment which results in focused designing work which produces a better output in comparison with products being made by a single team. The CAD is an instrumental effort which helps to share the design to the factories for large-scale production. CAD designed are designated with all the minute factors which come into effect while the product is in the process of preparation, creation and sending out for distribution.

Production and Sourcing

Distribution

The 2003 batch of Zara products had been discharged from this distribution centre. As the company expanded, it acquired and opened new distribution centres. An additional distribution centre from Zaragoza was announced even though the existing centres were working with 50 percent efficiency of its provided capacity. The centre was opened in 2003 after spending 120 million USD. The centre was designated for the supply of woman apparels around the world from Zara. The third major distributing centre was opened in 2011 in Meco, near Madrid (Fernie & Sparks, 2014). The third centre was fixed for online distribution and kids garment. Smaller centres for distribution were opened in Brazil, Argentina and Mexico. The Smaller docking station was opened to facilitate the transhipping delivery to parts of Asia and North to South America regional distribution. Furthermore, another new centre has been proposed by the company to be opened in Guadalajara in Spain. However, none of the existing distribution centres works to its full capacity.

The increasing numbers of distribution centres have been undertaken for the company to increase its inventory and facilitate distribution service around the globe. The company is under expansion and business is increasing with every passing year (Pickles & Smith, 2011). Therefore, infrastructure is required to maintain a huge demand of Zara products both to online and retail market.

Zara Online and Future

Conclusion

Finally, the online entity of Zara provided the company with a much-desired expansion which helped the company to acquire more buyers and reach places beyond barriers. Besides, the Meco distribution centre and storehouse become more instrumental in dispatch and distribution of the online fashions (Caro & Gallien, 2012). Therefore, the company is a good example of good strategy and efficient sectional management facilitating growth and success of the company.

References

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Christopher, M. & Holweg, M., 2011. “Supply Chain 2.0”: managing supply chains in the era of turbulence. International Journal of Physical Distribution & Logistics Management, 41(1), pp. 63-82.

Cortez, M. et al., 2014. Fast fashion quadrangle: An analysis. Academy of Marketing Studies Journal, 18(1), p. 1.

Macchion, L. et al., 173-188. Production and supply network strategies within the fashion industry. International Journal of Production Economics, p. 163.

McColl, J. & Moore, C., 2011. An exploration of fashion retailer own brand strategies. Journal of Fashion Marketing and Management: An International Journal, 15(1), pp. 91-107.

Willems, K. et al., 2012. From Armani to Zara: Impression formation based on fashion store patronage. Journal of Business Research, 65(10), pp. 1487-1494.

Wong, T., 2011. To copy or not to copy, that is the question: the game theory approach to protecting fashion designs. U. Pa. L. Rev, Volume 160, p. 1139.