· Three key success factors – short lead time, more style and low supply of any particular style.
· Zara – the flagship brand of Spain based Inditex group, founded by Amancio Ortega Gaona and opened its first store in 1975.
· 1058 stores located in 69 countries as of March ‘08
· Able to conceptualize the garment, develop, and deliver it to the stores within 2-3 weeks weres the industry average is six months.
· Key to success – integration of design, production, distribution, and retailing
· The model allowed Zara to respond quickly to shifts in consumer tastes and to newly emerging trends.
· The company 's instant fashion model, which completely rotated its retail stock every two weeks, also encouraged customers to return…show more content… · The garments were shipped out twice a week.
· Non-european consignments were sent to the airport for further distribution.
· Stores within Europe receives consignment within 24-36 hrs wereas outside Europe received them within two days.
· Zara achieved accuracy of 98.9% in its shipments.
· Once the merchandise reaches the stores, the goods were put on display straight away. With new stocks arriving twice a week, the stores always had something new to offer and the customers waited eagerly for new arrivals.
· The codes on the clothes conveyed to the staff where exactly the items needed to be placed. In the stores, the clothes were organized by color rather than type of garments. This was done in order to encourage customers to spend more time at the stores matching items.
· The stores were mostly located in the prime locations across the world.
· All Zara stores were uniform in outlay, including lighting, fixtures, window display and arrangement of garments.
· Most of the stores were company-owned and in some markets, particularly in Asia, Zara went in for alliance and franchises.
· Zara retained the right to open its own stores in the location and buy out franchised operations in cast the franchise experienced any problems with running the stores.
Zara’s supply chain - advantages and disadvantages:
· Zara was able to react swiftly to the emerging trend in the fashion industry. In contrast, other retailer took between 8 to 12 months to