Mission of Zara 1.

Response very quickly to the demands of target customers, who were young, fashion-conscious city dwellers and their tastes in clothing changed rapidly and hard to predict 2. Take advantage of intelligence and trust the judgment of employees throughout the company instead of relying on a small set of decision makers SWOT Analysis SWOT analysis analyzes current situation of organization and identifies factors that may affect desired future outcomes of the organization. The SWOT model is based on identifying the organizations internal strengths and weaknesses, and threats and opportunities of the external environment.

Pic1.The Form of presented SWOT analysis Strengths 1 Ability to recreate fashion, ZARA had great discretion in deciding what clothes would be design and produced. Collection were created, extended and design over time by team of commercials and were based on garment availability in stores. 2 Some group of commercials traveled extensively, observing residents needs and tastes and try to learn what kind of clothes would sell if Zara made them. So clothes would be design and produced based on regional sales patterns. 3 Store manager could store-to-store transfers when they saw that garments selling slowly in

one area were popular in another 4 Commercial function also exercised a great deal of autonomy. Commercials decisions were not typically reviewed by higher level managers. Zara trust the judgment of employees 5 Active use of stores, Zara spend relatively heavily on its stores. They are located in a city`s prime retail distinct, often on the best-known street, store layout were completely changed every four to five years. Zara has team to design the layout of the store 6 7 Zara has center that set and control the price of the products over the world Small Quantity Production. Maximizing Product Scarcity, Push customers to buy their product immediately and Increasing the frequency of visiting the store of customers. Because the clothes would always be in style and company intended to have fairly short life spans. Zara shoppers knew that if they saw the garment they like should buy it on the spot, because it might not be there on their next visit. 8 Predictions about what would sell well in each location. Stores orders told commercials how well the garment was selling and thus whether future production should be increased or decreased. 9 Each time with ordered items, commercials ship typically new garments for which Zara wanted to assess demand. They would be sent to stores in targeted geographies. 10 Short period of Collection preparation, Spending only 2 weeks from The market research to the sales (Normally it takes 6 months) 11 There was little inventory anywhere in Zaras supply chain. So cost of inventory is low and Garments did not stay long in a Distribution Centers (DCs) 12 Vertical systematization of product process, Zara own the group of factories, integrated manufacturing operations enabled its constant introduction of new items and also ensured short lead times. So Zara could have short time to bazaar by using this network, could move a new design from conception through production and in to the DC in as little as three weeks. 13 Zara`s DCs have a good and complete automation system which was written by Zara`s IT department. 14 No IT support was required to open a new store. IT system for sores is old but reliable and

stable

Weaknesses 1 Low quality, Zara garments were not design to be highly durable so they were described as clothes to be worn 10 times . so customers who want clothes with this property come to Zara 2 Not to sell clothes over the Internet. So the infrastructure of e-commerce is week in this company and it does not offer new model of clothes over the Internet. 3 4 5 DCs were not configured for picking small orders and shipping them to customers Middle price goods Lack of user-friendly and user oriented web site that user can have profile and get service and can take order and buy and customize the his favorite garment 6 Lack of on line customer service and call center so customers can not send on line questions or complaints or suggestions. And also lack of customer relationship management software that service the customers and gather information about users. 7 Lack of membership club that customers can enroll in it and take membership cart for take gift and promotion and discount depend on their shopping 8 Lack of E-New in the site that send the last news of Zara and hot fashion to them to encourage them to visit Zara`s stores. 9 Lack of accurate and integrate information system for control of all inventory of Zara so the manager of Zara could not online monitor the stock of all inventories. So make decision to manage the inventory was difficult. 10 In factories only very simple application were used to plan production. These applications did not use sophisticated mathematics to generate optimal plans and schedules 11 Infrastructure of ICT in stores are very old they used handhelds (PDAs) which had been introduced 1n 1995. PDAs were used primarily for ordering and for tasks such as handling garment returns to DCs and transmitting information from headquarters to all stores, the POS terminals still used the DOS operation system. So this systems are out of date and support them have high risk.

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The POS terminal were not connected to the centers and in one store they were not connected to each other in the network and are not connected to other financial systems. So employees copied daily sales totals from each terminal onto a floppy disk then carried these to the one modern terminal to transmit them to the center information system.

Opportunities 1 Zara brought out new items continuously throughout the year, including both changes to existing garments and entirely new creation. 2 Global fashion market, people in the world get close to each other by using media like Internet, satellite TV and other media. This media advertize, encourage, and sometimes force yang people to be fashion. 3 4 Growth of fashion market by advertizing Change the culture, in new culture, which introduce and advertize by tycoons, people should follow the fashion and consume more and more. 5 Products meeting the demand for fast-changing and short life-cycled fashion trends

Creating the value from product differentiation, Because of the fast turnover ratio, customers are hard to find the same cloth in the street, Customers enjoy the scarcity like high price product with relatively economical price ,New arrivals by regional groups

Utilizing the advantage of geographical condition, Hiring the Spanish and the Portuguese instead of people in the third world countries to utilize the advantage of geographical condition By positioning the design and production facility closely, make the fast action to the market situation possible, Most of suppliers are located closely.

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threats 1 2 3 4 Spend little on ads Emerging new comers Limitation of design copies Short life spans both within stores and in customer so competitors can use this gap to deliver styles which not exists in Zara store. 5 The network of the store did not spread over the world in the location with most fashion people. Italy had very few Zara store despite shopper of this country are the most fashion in Europe. 6 7 8 9 10 11 12 Competitors are doing great with designer collaboration broader target market. Increase in mobile shopping is potential obstacle for Zara Rising cost in textile