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Supply chain management - Essay Example

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Supply Chain Practices of Three European Apparel Companies: Zara, H&M & Benetton Part A: Describe (briefly) any of the three operations applying the input-transformation-output model to structure your response Input. Zara’s customized retailing strategy shortens the development phase to just two weeks until merchandise reaches stores, compared to the industry average of six month (Capell, 2008)…
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Download file to see previous pages Transformation. Another key strategy is that Zara keeps tight control and flexibility over every link in its supply chain, keeping the bulk of manufacturing in-house rather than outsourcing them. While other companies begin with the designers who plan a year in advance, Zara store managers monitor what is selling daily and track current sales trends. They feed information on what customers need but can’t find to designers who create the designs and have them manufactured instantly. Throughout its process, the ‘fast fashion’ concept enables designs to reach production in two weeks, and has been imitated by Forever 21, Mango, and Topshop (Hansen, 2012). Output. As for distribution, Zara does this exclusively through their own stores because they desire to control the customer’s entire experience. Its Just-in-time system was developed in collaboration with Toyota Motor thus enhancing its control. Smaller batches of clothing are delivered to stores, to project an image of exclusivity to attract customers, and precluding the need to conduct bargain sales to move mass quantities of out-of-season merchandise (Capell, 2008). Part B: Analyse the competitive priorities of the three apparel operations and the approaches taken to managing their supply chain Design Zara’s design phase ‘breaks all the rules’ in retail fashion by drawing ideas from the market and passing these on to its designers to create. Unlike conventional garment retailers, ideas for designs do not originate from the designers in Zara, but from the customers. Customers come into the Zara store, and if they could not find the design they wanted the store management feeds this back to headquarters for designers to work on. This system is what enables the company to realize its competitive advantages, that is, its fast development lead time to market of only two weeks, compared to six months for other companies. While the method assures Zara of a ready market for its designs, the designers however, could only experiment within a strict and narrow margin. Hennes & Mauritz (H&M) plans and designs centrally in Sweden, based on customer demands while achieving a balance among fashion, quality and price. The designers came up with their ideas by observing fashion trends, getting inputs from employees and feedback from customers; in this last aspect, they are similar to Zara. Unlike Zara which releases its designs within two weeks after order, H&M released its designs by seasons, in two main collections and several subcollections. Designing begins by brainstorming which involves all designers, buyers and pattern designers, a process not undertaken in Zara. Styles and designs previously successful and unsuccessful are deliberated on and a look of the year is decided upon. The result is that many designs brainstormed do not reach production. The design method of H&M is organized and shows planning, deliberation, and joint collaboration between buyers and designers, but it is time consuming and inefficient compared to Zara’s two week development to market system. Benetton’s designs depend to a large degree on their designers’ diverse backgrounds and cultures. Designing is organized ...Download file to see next pagesRead More
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