HOW ZARA SOLVES ITS PROBLEMS?

Zara’s success is due to its excellence in its Supply Chain and Operational Efficiency.
The designers are on the lookout for any new trends and designs which would be available in
stores after production in 4-6 weeks of time and any modification takes only up to 2 weeks. It
always keeps its Inventory low which would create a sense of urgency amongst its buyers for
the new trend.
The forecasting of the brand is accurate and pricing is done based on demand of the product.
To deliver unique fashionable items, it has a shorter lead time and when mixed with its
unique designs and small production, it is able to cater to the demand of Customers and still
price higher which is around 85% of the products at full price. Due to a constant change in
trends and designs, customers are appealed to visit stores. It has a flexible business model of
owning, co-owning and franchising with partners.

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 It buys bulk amount of fabric and does the operations related to apparel in its in-house
facility
 It has the capacity to increase or decrease the rate of production to maintain a lower
inventory to avoid higher expense
 It also keeps in mind to keep 85% of their capacity to cater to any sudden spike in
demand of seasons
 The wages per month are considerably higher than the competitors
 It commits around fifteen to twenty percent of the seasons line and around half of its
designs are product in the mid-season
 Zara pushes its managers who are administrating the stores to gather feedback from
the customers, their likes and dislikes which in turn is forwarded to the designers at
Zara
The Stores requests for order only twice which is on particular days. There is a fixed time
maintained by the delivery agents and arrival of shipments. Once the products reach store,
they are at sold immediately.
So, every department and every point of Contact know their duties and deadline. They are
responsible and accountable for each action that they take. The Solid distribution networks
helps in delivering the products to its stores in America and Asia in less than forty hours.