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It studies how it can be improved and gives recommendations. Since Zara is one of the industry leaders and has one of the best supply chains, it required fewer recommendations for improvement. Finally, the paper analyzes the location of the company’s plants and distribution centers to see whether they are optimal. In Zara’s case, they are in the short run but may cause problems in the long run.
Zara is a Spanish flagship store of the Inditex Group and a key player in the European fashion retail market. It started operations in 1975 by opening its first store in La Coruna and since then has been operating as a fast fashion company. It is one of the largest brands, by the Inditex Fashion Retail Group, that has 723 stores in 56 countries making sales of Euro 3.8 billion (India Supply Chain Council, 2006).
Its business model is simple; it imitates fashion off the runway and distributes it to the customers in the shortest time possible, even before designers themselves can reach the customers. Therefore, it has shorter lead times, more styles but scarce supply of these styles. To manage this kind of efficiency, Zara’s supply chain management must be efficient and that, it is. Zara uses a vertical supply chain management system, one of the best in the industry that allows it to implement its business model of fast fashion effectively.
Zara’s position is an industry leader in the fashion retail market. It has a very high product turnover – it produces more than 11,000 products annually. It caters to the trendy, middle class man and woman of ages 14 to 35. The mother buys Zara because it is affordable and the daughter buys from Zara because it is trendy (Dutta, 2002).
This paper will study Zara in the light of its Logistics and Supply Chain Management. It will be broken down into four main parts. First of all, the importance of measuring the performance of Zara’s Supply Chain will be analyzed. Secondly, key performance indicators or KPIs will
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Martin Christopher (2005: 11) defines the supply chain as “the network of organizations that are involved, through upstream and downstream linkages, in the different processes and activities that produce value in the form of products and services in the hands of the ultimate customer.” The various independent functions that contribute to the supply chain are marketing, warehousing, transport, purchasing and finance .
Companies find it hard to manage the vulnerabilities of earning reasonable margins by applying cost-efficient supply chain processes so that they register their presence in the market for a long term through lean inbound, internal and outbound supply chains.
Management of stock requires a balanced approach, by managing goods inventory with routine needs, and equilibrating the urgency to minimise the cost of stock-keeping with the transportation availability. The trade-off can result in keeping sufficient stock but not at the cost of facing cash crunch.
The word 'crisis' reveals the manner in which one competitor, say X takes advantage of the vulnerable situation of the other firm Y. Of course Y gets threatened because of the deadly mistakes the CEO has made in the name of strategies. Thus, CEOs do this by utilising the capabilities of LM as a weapon that when counteracts with their competitors, provides them with a win-win situation.
Knowing in advance the likely changes in customer preferences accelerates the adaptability of the firms to cling to enhanced speed and quality. An efficient supply chain management ably assisted by latest information technology for information sharing and Just-in-Time and other time compression strategies enable firms increase their operational efficiency manifold.
Logistics is simply the science of getting the required materials, goods or equipment to the right people at the right time and the development of this field owes a lot to the military history of civilisation which extends all the way back
Time compression will also be investigated as it constitutes a significant approach in minimizing or eliminating time-consuming activities and wasted time associated with business process. To this extend, information technology appears to be a
Secondly the company’s stock keeping units (SKU) count increased by almost 50% during the three-year period between 1998 and 2001. This was against the backdrop of a fall in its net profit margins by 1.7% between 2000
ng reflection report will apply the Gibb’s reflective cycle in a bid to analyse the events that took place during a logistics and supply-chain management consultancy project at the Dover Port. Gibb’s cycle is known to be a very vital tool in accomplishing project reflections
6 Pages(1500 words)Essay
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