Business Analysis Of Zara

In the very competitive sector of fashion retail and with the threat of low quality-mow price suppliers, organizations are challenged to innovate more than anywhere and to adapt in response of changes mainly due to globalization.

As we explained before, Zara is operating with a lean organizational structure, shortening the product life cycle and thus allowing a best success when meeting consumer needs and follow-up of fashion. This is due to the most important concern for the brand that is customer satisfaction, sharpening all business decisions, especially when talking about innovation.

But Zara also follows a vertical integration, controlling it production when most fashion retailers outsource with cheap labor. In this way, Zara based it

Indeed, Zara make possible to respond customer demand by being able to design a new product and have finished items in stores in 2 weeks when the industry average is 6 months. Moreover, Zara can modify existing products in less time. Moreover, the main part of their collection (around 80%) is created during the season and not months before contrary to what is commonly done in this industry. As a result, the brand produces more than 15000, items a year, when competitors produce between 2000 and 4000, and have an average of 70 items a day, what could be enough to put them at a top position. We can call that mass

With this speed of design and production, an item that doesn’t sell well can be stopped by the factory, replaced quickly by an other design and remote from stores. Thus, more than 200 designers work constantly on creating new items and searching new ideas ensuring a constant renewal to meet all consumers’ pleasure. With this way of thinking, Zara’s designers have a kind of experience but it exists a risk that some products will fail. They prefer accept the risk that represent a smaller price to pay knowing that more styles and models lead to more choices for customers and thus more chances to gain profit.

Not only that, Zara established a system of report for transmitting customers’ feedback to designers’ team everyday to quickly create sketch and turned them in to clothes. In fact, every cloth exposed in their store has been requested by customers, their leitmotiv is that customers determines production and not the opposite, that is very uncommon in