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Strategic supply chain & logistics management - Essay Example

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Case Study: Zara (Fashion and Apparel) Summary Zara is in the apparel and fashion business. Its growth in this sector is unprecedented, and is attributed to the kind of business strategy that it has applied all through the years. It produces most of its products and outsources only a small percentage of the products…
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Strategic supply chain & logistics management
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Download file to see previous pages The company website is a 24/7 interactive method wherein customers can make suggestions and also air their complaints. Zara is also affected by the growing tide of globalization. It is a knowledge-based organization and its workforce is composed of a pool of talented and expert individuals. Zara has invested on its employees. The company also aims for customer satisfaction and loyalty; that is why, its products and services are quality-oriented. Inditex, Zara’s mother company, sees to it that the company adheres to quality management and best practice. The company’s financial standing is as healthy as ever. Zara’s supply chain is effective. They ensure product quality and deliver it with speed and accuracy, making the customer asks for more. It’s what Zara has been doing all through the years. The main body Zara is owned by Inditex and is into the international apparel market and fashion, which are customer-driven markets. It is continuously growing and is a leading competitor in this kind of industry. Its closest rival is Hennes and Mauritz (H&M) which outsources most of its products to lower cost. On the other hand, Zara is a company that is quality-oriented. It produces 60% of its products and is into quality management. Unlike H&M, Zara ensures that its customers are satisfied and hopes to come back to buy more of its products. With the application of computers, the Internet and Information Technology, Zara provides speed of information to its customers. The Internet provides customer interaction; thus Zara’s website provides 24/7 service to update customers of its latest products and services. In the age of globalization, knowledge is both a product and resource. Organizations are now focused on knowledge-based economies, and are more concerned with the knowledge people possess; this is termed ‘people-embodied knowhow’. Firms take care of their workforce because of the knowledge they possess. They have invested much on their workforce. Zara aims for talents and customer’s focus and loyalty. This is the job of the marketing manager. It also sees the importance of focusing on their employees because they see the relation between contented employees and contented customers. Satisfied employees result in satisfied customers. Meeting the customer’s needs and wants is a business trend in the age of globalization. Zara aims for customer loyalty while keeping cost of production low. This is shooting two birds in one shot but difficult to achieve; difficult because meeting the customer’s needs and wants at the same time minimizing cost of production do not ensure quality product or service. But Zara focuses on quality in its many products. With respect to its closest competitor H&M, the two rivals have closely similar characteristics, for example their financial status, their operating revenues, etc. What is remarkable however is that Zara is a bit more liquid than H&M; Zara has a manufacturing plant that manufactures most of its products, while H&M only stores its products in a warehouse. These products come from outsourcing companies, mostly Chinese companies that manufacture products for a very low price. Inditex, Zara’s mother company, is an effective company which adheres to best practice and quality management. It has an operating profit much higher than H&M, and also adheres for expansion by building more stores according to company surveys and studies using scientific projects and anticipated ...Download file to see next pagesRead More
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