Zara Competitive Advantage

Zara is a high-end street store offering the latest tastes in fashion for women, men, and children alike. Amancio Ortego, Zara’s founder, has made the store grow with rapid success in both its home country, Spain, and internationally. One of the distinct reasons why Zara is such a unique company compared to its competitors is its foundation of the quick response system. Today, Zara’s cycle time is six weeks, in which it responds to its customers’ demand very quickly, unlike most stores that take half a year. Overall, Zara is distinct from most apparel stores in its ability to travel globally and from its international strategy.

Zara is a Spanish clothing and accessory retail company founded in 1975 by Amancio Ortega and Rosalía Mera. It is the main brand of the Inditex group, the world's largest apparel retailer. Zara also owns brands such as Massimo Dutti, Pull & Bear, Bershka, Stradivarius, Oysho, Zara Home, and Uterqüe. Zara’s strategy is to offer cutting edge fashion at affordable prices by following fashion and identifying which styles are “hot”, and quickly getting the latest styles into stores. They can move from identifying a trend to having clothes ready for sale within 30 days (whereas most retailers take 4–12 months). This is made possible by controlling almost the whole garment supply chain from design to retail. Zara, as of 2017, manages up to 20 clothing collections a year.

Apart from Zara, there are many different brands operate in Malaysia, such as H&M, Mango, Uniqlo. Zara goes after the number of customers as well as its supply chain among those brands which also operate in Malaysia. Zara owns its competitive advantages to carry on its business better than other brands.

Amancio Ortego started clothing factories in Spain, in 1963. In an attempt to integrate the manufacturing with the unpredictable customer demand, he opened the first Zara store in La Coruna in 1997. Zara came under Intidex multinational companyin 1985 and Jose Maria Castellano Rios, who shared the same opinion as Ortego that IT was important for their business, joined the company, who later became the CEO of Intidex in 1997. By 2003, Intidex had 1,558 stores in 45 countries, of which 550 were part of Zara chain.

This case discusses the unique supply chain management practices of Spanish garments retailer Zara, which enabled it to gain competitive advantage over other fashion retailers in the world. Zara's vertically integrated supply chain system enabled the company to place the latest designs in any store across the world within a period of two to three weeks. The company produced garments as per the latest trends in a limited quantity. Zara introduced 12,000 designs every year, with new designs appearing in the stores globally, twice a week. The case explains in detail the design, production and distribution processes of Zara's supply chain.

Consequently, Zara has become Spain best known fashion brand. The company started in 1963 .half century later , it has become own of the world's fastest growing manufacturer of affordable Spanish fashion clothing .currently there are around 2000 stores in 77 countries .

ZARA, a branded Spanish clothing and accessories retailer, was founded in 1975 by Amancio Ortega and Rosalia Mera. It is the flagship retail store of the Inditex group, a fashion group that owns many other brands such as Pull and Bear, Uterque, Bershka, Stradivarius and Massimo Dutti. Amancio Ortega opened the first Zara store in a central street in Galicia, Spain under the name Zorba. Although another store a few blocks away was also named Zorba, the molds of the letters for the sign was already created and it was rearranged, thus coming up with the name Zara. In 1980, the company started its international expansion in Portugal. In 1989, they penetrated the US market and in 1990, they entered the French market. In 2003

Inditex, Zara's parent company, has set Asia as a top priority for its expansion with stores in countries all over the region. With its growth in Asia, Zara seems to be well positioned as compared to its competitors.

Inditex is an international Spanish company that designs, manufactures, and sells apparel, footwear, and accessories for women, men and children through its chains and shops around the world. Zara is the largest and internalized of all the Inditex products such as: Massimo Dutti, Pull & Bear, Bershka, Stradivarius, and Oysho.

Industries in the new era tend to concentrate on linking with other corporations on a geographic level, to bring in all their forces together to create a highly technical & cost effective collaboration. This collaboration also involves joining forces with the suppliers across the product development cycle for easy access & faster processing of the products. This also ensures quick access to markets, lower product cost & better quality. Attaining successful suppliers results in success of the company & enhances its overall performance. It isn’t easy for a company to recognize if the suppliers they choose are capable of supporting their new product development or hinder their growth & effect the company’s performance. Companies need to be able to identify if the supplier integration during the product development phase has negative or positive effects on the technological risks & uncertainty. They need to choose the right decision for their company. Suppliers provide materials & services to an organization based on the new product requirements. The product or services provided by the suppliers may not be of a greater quality, determining this is the major job of a company. Since there might be chances that the supplier will have a better knowledge about the products than the companies, companies need to be cautious about it. Compromise on cost can be done but

Zara is one of the largest and the most internationalized retailers that Inditex Group owns. Inditex Group is based in Spain, which is a global specialty retailer that designs, manufactures, and sells apparel, footwear, and accessories for women, men and children around the world.

Ortega Gaona, CEO, founder, and Spain’s richest man founded Zara in 1975. Zara’s first store was in A Caruna where the headquarters now lay and featured lower priced lookalikes of high end, popular products selling to women, men, and children (Zara (Clothing) 2009). Beginning in the nineteen eighties Zara began experimenting with differentiating the design, manufacturing and distributing progression in order to condense lead times and respond faster to new trends. Gaona considered this to be “instant fashion.” Instead of individuals, Zara used information technologies and groups of designers to base its improvements in fashion. In 1998, the company began its international development through Portugal’s second city, Porto. By 1989 Zara entered the United States and by 1990 entered France. Zara’s international development expanded to Mexico in 1992, Greece in 1993, and Belgium and Sweden in 1994. Zara continued to open stores around the world until there were stores in seventy countries. This includes more than 519 stores in Spain, 116 stores in France, 87 stores in Italy, and 45 stores in the USA (Zara: Cool Clothes Now, Not Later). Zara Performance: Financials: Since Zara is a subsidiary of the parent company Inditex, this report includes some financials about Inditex. According to the

Inditex, the owner of Zara, first started out in the dressmaking and textiles industry before opening the first Zara store in Spain in 1975. The founders, Amancio Ortega and Rosalia Mera, pride themselves on the idea of fast fashion: incorporating a distribution system that keeps up with continually-changing fashion trends. Zara has a very centralized headquarters in Arteixo, Spain. This allows Zara to have a good grasp on the business processes. They focus on speed and responsiveness by delivering quick and small batches of clothing to stores at precise times. The first logistics center for Zara was built in 1984 and encompassed about 10,000 square meters. Since then, Zara has been extremely successful in the fashion industry, winning over the hearts in Europe and then working to expand to Asia and the U.S. The first US store opened in New York City in 1989, although only a dozen exist in America today.

In 1963 a Spanish multinational clothing company known as The Inditex Group, was founded by Amancio Ortega in Galicia Spain. It is made up of 100 companies specializing in textile design, production and distribution. This company started out by introducing a new way of fashion, instead of offering clothing that was long-lasting at an expensive price, they offered clothing in massive varieties at affordable prices. Now Inditex owns worldly famous brands such as, Zara, Massimo Dutti, Bershka, Oysho, Pull and Bear, and Stradivarius, Tempe, Zara Home, and Uterque. These brands have gone on to become corporate owned franchises and have locations all over the world. In 1985 the company had opened 80 Zara stores in Spain alone, and

Through the period of 1975- 1987, Zara expanded its network of retail stores in many big cities of Spain that reached a population grater than 100,000 inhabitants (Ghemawat and Nueno,