2. History of Zara
3. Case Facts
4. Contd
5. Contd
6. Competitive advantage
7. 8. Strategies
9. 10. 11. 4 P Approach
Product
Local preferences, designs and trends
Price
Different pricing strategies for different countries
Promotion
Different promotion strategies for different cultures
Placement
Effective distribution and location of stores
12. Analysis
13. Zara sources fabric, other inputs and finished products from
external suppliers.
Purchasing offices in Barcelona & Hong Kong.
Buying more from China might reduce the cost of goods sold in
future.
14. Inditex owned Comditel that managed dyeing, patterning and
finishing of grey fabric and supplied it to external and in-house
manufacturers.
Vertical integration helped to reduce the bull whip effect.
It also owned 20 other factories for internal manufacturing that
apply Just In Time .
15. Zara does not compete on prices.
They compete only on fashion for which quick response capability is
a must.
Zara can originate a new design and have it as finished goods in 4
to 5 weeks and just 2 weeks for restocking or modifying the
existing products.
The same takes 6 months for its competitors.
16. Global scenario
Build a decentralized distribution & production in each region
to highly penetrate the market and to reduce the complexity of the
process.
Value chain should be extended in each region effectively.
17. Looking ahead
Current supply chain model must be changed, cant be continued for
long.
In order to remain competitive and control costs Zara might have to
move manufacturing to India, China.
This might prevent Zara from refurbishing its product lines in
quick succession.
Zara pioneered the concept of customized retailing and was able to
conceptualize the garment, develop, and deliver it to the stores
within two to three weeks