Zaracase Essay

3333 Words Jan 29th, 2014 14 Pages
Zara Case Study

Contents 1. Abstract 3 2. Current state 3 3. Problems with current state 4 4. Competitors 5 5. Target State 7 5.1. Considerations 8 6. IT strategy 9 7. Cost Analysis 11 8. Conclusion 11

1. Abstract
Zara is one of the largest international fashion companies. It belongs to Inditex, a multinational retailer and manufacturer. At the beginning of 2003, Inditex operated 1,558 stores in 45 countries, of which nearly 550 were part of the Zara chain. The customer is at the heart of their unique business model. Quick and accurate response to shifting consumer demands is the goal of Zara.
The main objective of this case paper is to analyze Zara’s current business model, focus on issues they
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IT is at the heart of Zara’s business. Information in collected from university campuses and other venues on daily basis and is stored into a database at head office. Designers have access to real time information while deciding on fabric, cut and other points of a new garment. Also product information and inventory management enable Zara to design a product with available stocks rather than ordering and waiting for the material to receive. Additionally, its state-of-the-art distribution facility runs automatically and makes sure that each order reaches its destination. Optical reading devices distribute more than 60,000 cloths in an hour so merchandise does not waste time waiting on human sorting.

* Resources
Zara controls production processes in order to keep designing and manufacturing in-house or near to its headquarter. Currently, Zara maintains 80% of its production processes in Europe, 50% in Spain which is very close to La Coruña headquarters. Strategic agreements with domestic organizations are among the main reasons causing Zara to meet its goal of design and produce for fast changing taste of customers.

* Networks
Different branches are not able to communicate with each other through the network and realize what product is either available or out of stuck. The action they take instead is to call and ask the store manager

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