Logistics and Outsourcing in China: the Benetton Group S.P.A. Case

The Benetton Group is one of the biggest clothing retailer/apparel manufacturer in Italy, present in 120 countries through a network of over 6,000 stores that generated a turnover of €1.6 billion in 2013 and employs around 6,500 employees. The Italian group’s characteristics, style and design expertise are clearly transmitted through their brands which combined, produce more than 110 million garments per year.

Fierce competition, fluctuating market demand and rising customer requirements has led to customers becoming more demanding with increased preferences (Zhang and Cheng, 2006). In, the 21 st century, participating largely in globalization has created significant opportunities, and at the same time, put pressure on the automotive industry manufacturers to enhance quality, improve styling, increase organizational efficiencies and drive innovative features into their products in an effort to attract customers and expand into new markets (BCC, 2005). This paper explores the concept of supply chain management with a case study of one of the greatest motor brands BMW. We will look at the supply chain strategy of the company and how successfully it

Zara’s rapid growth and success are attributed to its strategy of highly responsive to changing trends with affordable prices. To achieve this, Zara uses a combination of flexible and quick sources in Europe and low-cost sources in Asia. As we known, Asia own the cheap raw material and labour for manufacturing, hence most of its apparel manufacturers have moved to Asia to reduce production costs. To reduce inventory holding and forecast error, Zara usually produce its apparels after the start of a sales season for a typical retailer, along with the forecast postponement of decisions until after trends are known. Inditex owns 8 distribution centres (DC) in Spain for distributing all finished products to all its stores worldwide. Even though the products are manufactured outside Spain, all the finished products must be concentrated into these 8 DCs before distribution. This allows store inventory to closely match local customer demand and reduce holding costs of over-inventory. (Sunil Chopra & Peter Meindl, 2016,

Recently an opening of the economies of developing nations, especially China, has allowed a huge shift in outsourced production. For the most part the products of the outsourcing are destined for North American consumption, which creates interesting obstacles to the realizations of improvements predicted. Mega Bloks Inc is a Canadian example of this trend, having recently made their own foray into outsourcing to China. An examination of supply chain issues reveals the overall complexity and number of issues which could develop for a company like Mega Bloks. More specifically, for Mega Bloks issues of logistics, regulation, control (in general and specifically of quality) come to the forefront. All of these issues can individually and

Therefore it has become crucial to have an agile and responsive supply chain set up for both these companies. The main objective of the strategy is to reduce the lead times related to the process of getting new designs with good quality and right price into the retail stores in order to have the ability of responding to new market conditions and fashion trends. To achieve these objectives, Zara and Benetton have set up some supply chain strategies that resemble each other in many ways; they both focus on delivery, flexibility, efficiency and responsiveness to the production requirements of the company. Moreover, Zara controls every step of the value chain, closing information loop quickly, leveraging ownership of own asset, even trades off cost benefits to increase responsiveness of total system. In production stage, Zara has smaller batch productions compared with Benetton, this leads to a faster inventory turnover and quick response for Zara which is also equivalent of manufacturing's JIT to the retail sector. On the other hand, Benetton has based its supply network on two models of Industrialized Model and Commercial Model, sometimes referred as a dual supply chain. These models use two ways of planning. One is sequential approach aimed at minimizing costs and

In response to the request of the Director of Sustainable Sourcing Department, this memorandum provides analysis and recommendations on supplier risk mitigation. Government publications, industry reports, newspaper articles, company reports, and peer-review journals were used for this analysis. The five Asian countries, China, India, Indonesia, Vietnam, and Malaysia accounted for 40% of global apparel production and 50% of global exports. External factors may drive manufacturers to relocate due to increasing labor cost, the transition will be unlikely in the next five years. While U.S. based companies are facing various business challenges, the associated risks from sourcing products from Asia can have detrimental effects on both financial and brand image as seen from Nike, Inc. and Mattel. Therefore, establishing supplier credibility and developing strategies to mitigate supply chain risks are important agenda for Target Corporation to avoid potential damage.

The Spanish retail chain Zara has unique supply chain management practices that enable it to gain a competitive advantage over other fashion retailers in the industry. Zara’s rapid response time enables the firm to quickly respond to changing fashions while deliberately under producing products. This strategy, which is supported by competencies in logistic management, design and information systems, allows the company to maintain less inventory and higher profit margins and is a key factor to Zara’s success. The firm should continue to add value by seeking new opportunities to expand in the retail market and maintain their sustainable growth.

This paper is meant to determine whether or not the theory of comparative advantage applies to China with respect to the industrialized world. We will also touch on how the theory of factor endowment applies to China. There are some countries which operate in autarky, which will be discussed as well. Finally, we will examine how the distribution of gains from free trade causes much political debate regarding trade with China.

The purpose of this paper is to analyze the supply chain of the global apparel industry, including the materials sourced and global manufacturing. First, an overview of the apparel supply chain will be explored, in order to identify the current trends in materials used as well as the purchasing process for fabrics and distribution to retailers. These trends will then be analyzed in order to determine the possible effects that the apparel supply chain may have on global sustainability. This research is conducted based on the assumption that clothing companies develop supply chain processes in order to be the most

This is a case study that is about Bose, a manufacture of luxury audio systems, and the details of how Bose creates an efficient supply chain, while producing high quality products, through certain techniques, contracts, and strategy implementations. This Case study highlights how Bose analyzes their suppliers through a performance measuring system. This measuring system assures Bose, that they have the have the best suppliers to create the best quality. Another strategy that was touched on is the implementation, design and integration of an electronic data interchange (EDI) which allows Bose, and their suppliers, to closely monitor inventory levels. This electronic data interchange allowed Bose to create the “JIT II system” which selects the best person to order, and manages inventory levels is the main supplier. These strategies are the reason why Bose has an efficient supply chain, and high quality products.

For partners of ASOS, they generally go through the same production process as ASOS own-branded dress. However, they receive the order from ASOS and its merchandisers instead of consumers. It is an important process for ASOS as understanding the product lifecycle and stock level, they can plan the introduction and withdrawal of product. Also price can be adjusted accordingly with which sales are introduced during the decline period (The Times 100, NA). However, this supply chain requires a high collaboration of functions across supply chain (Fernie, 2009). The reason why ASOS can eliminate the traditional functions of a retail store is due to its well-managed supply chain, effective stock keeping system and fast-going logistic system (Meadows, 2007).

Supply management is a complex function that’s critical to business success, responsible for delivering efficient costs, high quality, fast delivery and continuous innovation throughout companies’ entire supply chains. The strategic contribution of supply management is measured not only in savings made, but also in increased shareholder value (Niezen, Weller & Deringer, 2007). Nike and Adidas are two global companies try to improve their competitive advantage through strategically managing and utilizing their supply chain. The purpose of this report is to compare and evaluate the supply chain management practices of Nike & Adidas.

The scope of this investigation is limited to a pure academic exercise of Supply Chain Analysis in a real world situation. Even though, the study aims to provide insight on how to improve Tsingtao’s Supply Chain. The report is also limited to a specific division in South China. This method was chosen to enable detailed analysis of a current supply chain in action. Moreover, anglicizing on the Tsingtao’s supply chain in general would be too complex, and therefore not generate meaningful outcomes or strategies. In addition, the availability of information limits the study to a suggestion of a series of broader initiatives.

The shifts in the jeans manufacturer Levi Strauss’s global strategy could vividly demonstrate how global sourcing strategy works and affect its supply chain. At first, the company was created in the USA. As it developed and became a global company, they began to employ workers all over the world. However, in face of fierce competition, Levi Strauss started to shift its operation to lower-cost countries in the late 1980s. By the year 2003, Levi Strauss closed the last four plants in North American and ‘has become an entirely offshore producer’ (Dicken 2011 p.318). The German fashion company Hugo Boss also provides similar example. In face of high production cost, namely high labor cost in domestic market, more and more fashion retailers choose to outsource their production. Moreover, some fast

The world has become fascinated towards the fashion. The first thing need to be considered is Fashion; it can be behavior, implementing new ideas on clothing’s, hairstyle, decorations and so on which are automatically linked to our day to day activities. In today’s context, fast fashion has become a trend to a fashion industry patterns yet delivered utilizing less costly materials to guarantee a low cost tag. Many companies have been successful and unsuccessful to earn a trust from their customer. For the matter of success level it depends on how innovativeness they are and also applies the principle of supply chain and logistic management activities for the growth of their