Zara is able to adapt couture designs, manufacture, distribute, and retail clothes within two weeks of their original appearance on catwalks. This speed allows Zara to give customers what they want faster than competitors. Zara operates with just-in-time production and a solid distribution network to deliver goods to stores within 24 hours of production. Each Zara outlet sends in two orders per week on specific days to ensure a fast, predictable, and centralized fulfillment process. Zara studies customers continuously through daily sales data and feedback reported from stores to designers to decide on new designs.
Zara is able to adapt couture designs, manufacture, distribute, and retail clothes within two weeks of their original appearance on catwalks. This speed allows Zara to give customers what they want faster than competitors. Zara operates with just-in-time production and a solid distribution network to deliver goods to stores within 24 hours of production. Each Zara outlet sends in two orders per week on specific days to ensure a fast, predictable, and centralized fulfillment process. Zara studies customers continuously through daily sales data and feedback reported from stores to designers to decide on new designs.
Zara is able to adapt couture designs, manufacture, distribute, and retail clothes within two weeks of their original appearance on catwalks. This speed allows Zara to give customers what they want faster than competitors. Zara operates with just-in-time production and a solid distribution network to deliver goods to stores within 24 hours of production. Each Zara outlet sends in two orders per week on specific days to ensure a fast, predictable, and centralized fulfillment process. Zara studies customers continuously through daily sales data and feedback reported from stores to designers to decide on new designs.
Zara is able to adapt couture designs, manufacture, distribute, and retail clothes within two weeks of their original appearance on catwalks. This speed allows Zara to give customers what they want faster than competitors. Zara operates with just-in-time production and a solid distribution network to deliver goods to stores within 24 hours of production. Each Zara outlet sends in two orders per week on specific days to ensure a fast, predictable, and centralized fulfillment process. Zara studies customers continuously through daily sales data and feedback reported from stores to designers to decide on new designs.
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SECRET OF ZARA’S SUCCESS
“Give customers what they want, and get it to them faster than anyone else” Amancio Ortega founded Zara in 1975, from that first store in Spain, Zara has since expanded to more than 2,200 stores in 96 countries around the world. As a brand, their speed and responsiveness to the latest fashion trends are key to Zara’s competitive advantage. Zara operates in a completely different way from other clothing companies. Synergy between Zara’s business strategy and operational processes: - Zara’s overarching strategy is achieving growth through diversification with vertical integrations. It adapts couture designs, manufactures, distributes, and retails clothes within two weeks of the original design first appearing on catwalks. Less clothing in stock means lower storage costs and fewer markdowns. Shoppers will frequently stop by Zara to see fresh and trending designs. Since merchandise is limited, there’s a frenzy to grab clothing before it’s gone. Just in Time production and Solid distribution network : - Zara’s success relies on keeping a significant amount of its production in-house and making sure that its own factories reserve 85 percent of their capacity for in-season adjustments. In-house production allows the organization to be flexible in the amount, frequency, and variety of new products to be launched. - Zara also has extra capacity on hand to respond to demand as it develops and changes. For example, it operates typically 4.5 days per week around the clock on full capacity, leaving some flexibility for extra shifts and temporary labor to be added when needed. - Zara’s strong distribution network enables the company to deliver goods to its European stores within 24 hours, and to its American and Asian outlets in less than 40 hours. This is also the reason why Zara can afford the extra labor and shipping costs needed to accommodate and satisfy changes in customer demand. Centralized order fulfillment: - Zara sticks to a deep, predictable and fast rhythm, based around rapid deliveries to stores. - Each Zara outlet sends in two orders per week on specific days. Trucks leave at specific times and shipments arrive in stores at specific times. Garments are already labeled and priced upon arriving at their destination, meaning they’re immediately ready to be sold. - Every staff member involved in the supply chain – from design to procurement, production, distribution, and retail – knows the timeline and how their activities impact other functions. That also extends to Zara customers, who know when to visit stores for fresh new garments. The company’s approach is just another example of why streamlined operations and supply chain management are critical to profitability and achieving scale. The secret to Zara’s success has been centralization. They can make decisions in a very coordinated manner. Consumer Is Key: - Zara boasts of a ‘data processing centre’ that’s open every hour of the day — it allows every single one of the stores to track sales data while another team zeroes in on customer feedback. Store managers actively monitor customers’ reactions on the basis of what they buy or don’t buy and what they say to a sales clerk. - The sales staff is trained to draw out these sorts of comments from their customers and store managers report this information to the headquarters every day where it is then transmitted to a vast team of in-house designers, who quickly develop new designs and send them to factories to be turned into clothes. People’s responses and behaviors provide useful information for improvement. Zara studies consumers continuously to decide what direction it should take its designs before starting the process. Be willing to change course to adapt: - Zara’s success is based on its ability to adapt quickly. Unlike many clothing brands, whose designs are stagnant for the season, Zara is constantly assessing and reacting to the environment in a matter of weeks. It’s also important to stay flexible and be willing to reassess the situation frequently.
