Zara Case Study

1961 words - 8 pages

1.0 Executive Summary
I recently had dinner with Bruno Sanchez Ocampo where we had a discussion regarding the possible upgrading of Zara’s point-of-sale (POS) terminals to units that operate in the modern Windows Operating System (OS). Zara’s current POS terminals run on the Microsoft Disk Operating System (DOS).

As the largest retail chain established by Inditex, Zara generates 73.3% of the group’s sales. With the ability to quickly respond to the demands of their target customers, young fashion-conscious city dwellers, Zara are able to produce and deliver styles while they are still hot. Zara has three departments (Men, Women, and Children), each department, at corporate level in La ...view middle of the document...

Twice a week store managers place an order for replenishment of existing items and initial orders for newly available garments. As the store POS terminals still operate on DOS and are not linked to an onsite computer, the store managers and staff have to manually inventory the store as part of the order using personal digital assistants (PDAs). PDAs are also used for handling garment returns and for transmitting information from headquarters to all stores. Each night, via dial-up modem, the inventory, or order, is transferred back to La Coruna. A group of commercials are then responsible to fill and ship the orders via Distribution Centers (DC) while consulting the new order information and the known inventory within a DC. If demand for a stock-keeping unit (SKU), the combination of garment plus fabric plus color plus size, is greater than the supply, the commercials will decide which orders get filled base on which stores have been most successful selling the particular garment. These commercials work closely with product managers to determine future production for each SKU. Zara has a vertically integrated manufacturing operation that allows the constant introduction of new garments and also ensures short lead times for the manufacture of goods. In as little as three weeks, a garment can go from design conception to arriving at a DC.
Like Zara’s approach for speed in the design, manufacture and delivery of garments, the company takes a similar approach with regards to information technology (IT). With no budget process, no chief information officer and no commercially available accounting software in place, the company has developed its own accounting, ordering, fulfillment and manufacturing software. As a result, there is no integrated IT system across the company.
2.0 Issue Identification
Zara is building a bigger and bigger company, while at the same time; internal systems are not being upgraded to follow in line with current technology. Microsoft no longer provides support for DOS. Should the vendor that provides our POS terminals discontinue or upgrade their machines to systems that are not DOS compatible, Zara would not be able to open additional stores, as in planned for further expansion in Italy, nor would they be able to replace any existing POS terminals should they breakdown. As a result, should Zara have to upgrade the current POS terminals that operate on a Windows OS, there is no IT department in place to handle the task of installation and implementation. At the moment Zara write their own software, the installation of POS terminals supported by DOS is quite simple with no IT support required. As a result IT spending is 0.5% of revenue compared to 2% of the competition.
3.0 Environmental and Root Cause Analysis
Founded by Amancio Ortega, Zara is an industry leader for “fast fashion”, it has built a reputation for responding quickly to the demands of its target customers and for its constantly changing store...

Other Papers Like Zara Case Study

Case Study - Zara International

701 words - 3 pages Jay Case Study: Zara International Fashion at the Speed of Light Question 1: In what ways are elements of the classical and behavioral management approaches evident in how things are done at Zara International? How can systems concepts and contingency thinking explain the success of some of Zara’s distinctive practices? Answer 1: Elements of the classical management approach are very evident at Zara International. The classical management

The Unconventional Business Strategies of Zara: a Case Study

2305 words - 10 pages The Unconventional Business Strategies of Zara: A Case Study Informational Technology and E-Business BUAD 6800 February, 2013 INTRODUCTION At first glance, La Coruna, Spain is a small, poor ship-building town in northern Spain; however, it houses a company, Inditex Corporation, which is a technological leader within the fashion industry. This small town houses “The Cube,” which is the

Case Zara

874 words - 4 pages practices but they can. 4. Should Zara open a major warehouse outside Spain? If yes, where? After reading the study case i think it is not necessary to open a major warehouse because the way that Zara is working right now is doing very good and for a major warehouse it is needed a big investment. In the other hand, that can also provide some advantages like control the distribution more closely from the manufacturing places and in a long time that could also decreased costs. In my opinion we should study the costs and the investment and after that we could decided if is a good thing or not. 3

Zara Case

1399 words - 6 pages the POS vendor decided to move away from DOS. If that is the case, Zara could suddenly fall into a situation that everything could go side ways. Furthermore, there were increasing amount of voices from store managers that the current POS system was lacking of some key features which can help them run the stores better. However, Sanchez, the manager or the technical owner of the POS system, argued that everything for the POS worked seemlessly and

Zara Case Final

3007 words - 13 pages brand's marketing strategy, it interprets the universal business model used the fast fashion clothing brand to do business. This paper adopts the method of case study, first makes detailed analysis on the research object –ZARA, then summarizes the operation mode of fast fashion brand, and based on this put forward recommendations on problems needed to pay attention when clothing enterprises develop fast fashion business. Introduction of Zara

Zara Recommendations

809 words - 4 pages help the company to measure its financial and non financial approaches (Dick et all, 2006). Through this company will motivate its employees, to work more efficiently and to achieve the targets of the company. References: Goransson, S., Jonsson, A., Persson, M. (2007) Extreme Business- Models in the Clothing Industry (A Case study of H&M and ZARA), available from http://www.essays.se/about/Extreme+Business-Models+in+the+Clothing+Industry

Zara Success

2083 words - 9 pages , the model has reconfigured the fashion landscape everywhere. Zara has blazed a trail for cheaper and cheaper fashion-led mass-retailers, has put the squeeze on mid-priced fashion, and has forced luxury brands to scramble to find ways to set themselves apart from Zara's look-alike designs. Leadership certainly has its perks. II. Discussion Questions | Question 1 (300 words, 30 marks) As described by the case study, explain the supply

The Strategy of Zara

2144 words - 9 pages  company's success is proof that it is still possible to build a massive brand by doing no more than meeting a market need. And that’s what we learn from the marketing and study the case of ZARA. Reference Alicegy. (2011, March 7). The feature that make Zara a success. Over the Rainbow. Retrieved from http://blogs.ubc.ca/aliceguo/2011/03/07/the-features-that-make-zara-a-success/ How Zara can succeed in India as an

The Analysis of Zara

4708 words - 19 pages . [online] Available at: http://zh.scribd.com/doc/125399832/Topman-Research-Document. [Accessed May 8 2014]. Palmer,A.2004.Introduction to Marketing theory and practice.2nded.The united States.Oxford University Press Inc. Pearson.A.2010.The story of ZARA-the speeding bullet[online] Available at: http://www.uniquebusinessstrategies.co.uk/pdfs/case%20studies/zarathespeedingbullet.pdf [Accessed May 21 2014] Posner, H. (2011). Marketing Fashion

Swot of Zara

694 words - 3 pages , including: sales, profitability, valuation, and financial ratios: H&M, Uniqlo. Although there is intense competition in the Asian of clothing industry, established brands can still earn a price premium over the competition in this market. Reference: 1) "Rapid-Fire Fulfillment," Harvard Business Review, Vol.82 No.11 November 2004 2) Zara’s Business Model, Information and Communication Technologies, and Competitive Analysis." 123HelpMe.com. 15 Nov 2009 http://www.123HelpMe.com/view.asp?id=97642 3) “Zara case study IT management.” mightystudents.com. 15 Nov 2009 4) Feb, 06, 2009 Business Daily from THE HINDU group of publications

Zara

358 words - 2 pages facilities are kept in-house: dying and processing activities of fabrics are fully controlled (not out-sourced). Non-strategic activities are fully outsourced and the actual ‘assembly’ processes of pieces are fully outsourced. Since all the necessary raw materials are present when market data is received, the fabrics can be translated into super-fast end products. As a preliminary conclusion, the ZARA case indicates the agility and adaptability aspects of flexibility in SCM.

Related Essays

Zara Case Study

3584 words - 15 pages Zara: Fast Fashion Case Study IEOR 153 Logistics Network Design and Supply Chain Management Niko Katigbak Regine Labog Kevin Leung Ruoyun Li Miranda Ortiz Michelle Papilla Spring 2011 Professor Kaminsky UC Berkeley I. Background Inditex, founded by Amancio Ortega, operates six different chains: Zara, Massimo Dutti, Pull&Bear, Bershka, Stradivarius, and Oysho. Since 2006 when the case was written, Inditex has added Zara

Zara Case Study

1614 words - 7 pages Zara Case Study - Answer the following questions using both the case in the text and online research. Citations (within the text) and a bibliography are required. Be sure to provide an overview of the case in a short paragraph prior to answering each question. List the question you are answering prior to your answer. Vertical Supply Chain Zara uses a vertical supply chain, which is an uncommon strategy in the fashion industry. A company

Zara Case Study

853 words - 4 pages ZARA Case Study By Chander Shekhar Sibal (WMP 6015) A Case Study submitted in fulfillment of the assignments for MIS WMP 2013 [pic] Indian Institute of Management, Lucknow Noida Campus 2011 Zara Case Study Q. 1. Zara is successful in managing IT. Using your learning’s from the case, explain how Zara is able to get productivity benefits from IT The firm tripled in size between 1996 and 2000, then

Zara Case Study 2584 Words

2584 words - 11 pages definitely consist of high competition. Also there are market leaders and there will be upcoming leaders using their competitive strategies. A firm can be either be cost effective and make their product cost lower than the competitors and be the market leader. Also they can differentiate the product where they have a unique product than their competitors. According to this case-study, the three brands taken in to consideration will be Zara, GAP