Zara: It for Fast Fashion

The Supply Chain Management Association:

Case Study Response

Zara: IT FOR FAST FASHION

Report of Supply Chain Management Issues

Prepared by: Oxana Vatamaniuc

June 2015

©Supply Chain Management Association

Table of Contents

Executive Summary _        

Introduction _        4

Environment and Root Cause Analysis        6

Issues Identification        7

Alternatives and Options and Implementation        9

Recomendations        11

Monitor and Control        12

Exhibit One: Value Stream Map        13

Executive Summary

Respecting customers, prioritizing innovation, fostering teamwork are at the foundation of Zara’s success…

Zara is one of the largest international fashion brands in INDITEX. The company first opened in La Coruna in 1975 and still lives by the idea of Armancio Ortega, “you need to have five fingers touching the factory and five touching the customer” in other words: Control what happens to your product until the customer buys it. Today, Zara is one of the largest international fashion brands of Inditex – the holding company atop Zara and other retail chains.

This case study represents the supply chain and IT infrastructure analysis of Zara. The objective of this case study is to discuss whether to update the current DOS/IT infrastructure and evaluate the effects of the upgrade. Using presented value stream analysis, we can understand Zara’s core business model of vertical integration and assess the areas where OS will add value to the system. This case study also presents the OS implementation opportunities and evaluates the effectiveness of the implementation. In addition, it concludes by providing recommendations for updating the current OS along with its advantages.

Introduction

In nowadays changing conditions of global demand, companies and especially its supply chain have to respond to changes in an agile and flexible manner. The era of having production moved overseas, so companies can take advantage of cheap labor is coming to its end. Fast fashion is more and more competing not only on price, but also on time.  Product and technology life cycles are likely to continue to shorten while demand will be increasingly hard to forecast. Apparently it is a result of customers’ demands because these are young, fashion-conscious city dwellers who change their tastes in clothing very rapidly are hard to predict and also hard to influence.