Zara Is One Of The Best Examples Of Supply Chain Success

Zara is a clothing line a chain of stores from Spain that belongs to the INDITEX group, a Spanish multinational textile producer, and distributor. Zara is present in countries in Europe, America, and Africa, with more than 1400 stores in 69 territories but with the majority of them in Spain.

Zara is known for having one of the best supply chains due to their particular attention to detail when it comes to their logistics, something that comes only second to their products. The company is very focused on anticipating their client’s needs and the demands of the market. Their supply chain has been improving in leaps and bounds in the last few years and it has adapted to a more globalized economy by sustaining a brand that is quick and flexible on their distribution. Their efficient process quality control allows for products to be available in short order and their clothing collections have a constant rotation, something that satisfies customers and at the same times it generates the chance to implement better production and distribution strategies.

Logistics

Zara’s main logistics center is located in Arteijo, a province in La Coruña, Spain. This is the place where the first store was opened back in 1975.

Products made by Zara are designed and created based upon current fashion trends and the projections they foresee in the near future. The brand has a great capacity to answer any feedback and complaints generated by customers, and they can have the new creations available in store in as short as 15 days from their initial production. This aspect is pretty impressive considering the sheer number of shops located all over the world, something that is evidence of their effective supply chain.

The process of creating products

This fashion corporation produces more than 450 million garments every year. All of this clothing is taken to a distribution center in Spain where new products are identified, checked, labeled and counted. From there, they are transported and kept in special warehouses that ensure the preservation of the articles until they arrive at their final destination. Normally Zara and their transportation subsidiaries deliver everything in 48 hours to their different points of sale. The company uses radiofrequency technology to track individual shipments and boxes in order to properly control the flow of each different reference and style up to the point that is delivered to the store.

Zara’s success is all about their processes

Unlike other stores that actually compete with the brand like The Gap for example that subcontract their production to third parties, Zara produces 60% of their garments in their own factories, improving their supply and the relationship cost-benefit of their processes. That goes without even mentioning the effectiveness and speed of their manufacturing.

Their fabrics are from Spain, India, the Middle East and Morocco. Everything is dyed a cut according to the needs of the company and the rest of the processes take place in workshops located locally in Spain. The majority of products produced by Zara designed with exclusivity in mind and strive to be different from the competition. Most of their clothing is directed towards cosmopolitan youth.

Another advantage this brand has is that thanks to their great productivity and logistics operations, they are constantly renovating their stores. This attracts customers and it is a factor that makes them a lot more attractive, to the point that people will line up to buy when it comes time for a new collection.

zara_supply-chain-management_logistics
Image courtesy of Alberto Garcia at Flickr.com

Sales

INDITEX is in charge of purchasing, distribution, and inspection of all branches of the store. Hundreds of suppliers deliver their products within a week in order to ensure that the process is not delayed. Fabrics are bought crude and without dyes so patterns and designs can be changed mid-season if necessary, in order to anticipate customer’s needs and meet the demand of the changing industry.

New articles are created in the company in order to assure their quality before third parties are commissioned to continue production. Delicate articles like stones and accessories are subcontracted in order to reduce costs and maximize variety, while time-sensitive pieces are also created internally.

The trick is to maintain a careful balance between what can be produced massively and what should be done carefully and in small numbers in order to always give prevalence to what moves the industry, what attracts customers and what makes them loyal to the brand. Zara always gives people the feeling that they are wearing garments that are original, exclusive and unique, just like the type of clients the brand always seeks to attract and has been so successful doing so. Many things can be learned from the way this Spanish brand handles business and applied to many other types of market.

If you want to learn more about great examples of successful supply chains and great logistics operations, check out our articles at David Kiger’s Blog.

* Featured Image courtesy of  Leif Harboe at Flickr.com

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