Describe about the Logistics and Supply Chain Management for Fast Fashion.
Zara is identified as the “Fast Fashion” model in modern trends. The delivering of the best product according to the fashion trends is identified as a specialty of Zara. In a complete sense, Zara is identified as the style icon and leader of the fashion world. The production house of Zara was first initiated at the La Coruna of Spain. The Inditex is identified as the major contributor and parent company of Zara. In Australia, the first store was inaugurated in Sydney and then in Melbourne (Crofton & Dopico, 2012). The major aspects of the Zara are to manage appropriate customers and their demand centric approach. Now, the product is expanding on a world-wide level and successful in manufacturing and producing major products (i.e. Apparel).
The aim or objective of the research is to provide the best information related to the supply chain management of the fashion retailer Zara. The competitive advantages and the sustainability aspects are required to be found out with the help of this report. The comparative study of the supply chain management and logistics are also being identified (Hume, 2011).
The discussions and analysis section is helpful in defining the suitable output related to the supply chain and logistics in Australia. The four sub sections defined below will assist in explaining the different concept with specific information.
The case study provided for the discussion is successful in delivering the logistics and supply chain management in Zara. By generating the suitable ideas from the case study, the basic and fundamental reasons for the success will be required to be identified. These fundamental reasons will help in strengthening the logistics and supply chain management in a possible manner. There are various competitors of Zara, which are both successful and unsuccessful in their ventures (Mangan, et al., 2008). But, the list of the major changes is displayed below which shows the fundamental reason for the success of Zara: –
The first fundamental aspect of Zara is the Fast service provided by them in comparison to the other fashion brand like Myer. The stocks of the apparel are introduced in the market before the innovative trend is introduced.
The cost and quality are also identified as the considerable features. In comparison to the H&M, the cost is quite less and the quality is far better. The H&M is not successful in delivering the best products in the market.
In comparison to Dell, the organization mainly believes in providing the city specific trends in a specific manner. According to Australia, the Zara is successful in providing the best outfits. They manufacture clothes according to different seasons (Chaudhuri & Kowsmann, 2016).
The designs are so normal and attractive. The company only believes in introducing the new concept related to the fashion and trends, but doesn’t emphasize on making the products in a specific form. This aspect of Zara makes it different from Mango and Katherene Watson.
The new and innovative concept is introduced by Zara Australia, which is identified as the JIT concept in context to the supply chain management and logistic. With the help of this concept, the fashion aspects gets completed in “Just in time” and also helps in giving tough competition to Mr. Price.
The “makes less and sell more” concept of Zara will be helpful in providing an appropriate assistance in a specific mode. The organizations like Pepe, Vero Moda and other organizations manufacture their product at another location with the specific demands. Whereas, Zara believes in making some products in reliable form, so that maximum customers can purchase it and contributes in increasing the sale.
These basic fundamental aspects will be helpful in making the organization different and presentable in comparison to the other competitors working in the same domain. In short, it can be assumed that the speed in delivery, vertical integration, the use of just in time strategy and the technological advanced process helps in framing suitable flow of the logistics and supply chain management (Schlossberg, 2015).
The issues that are visible in the case study are related to the logistics and SCM in the Zara. The suitable strategic approach should be planned to face suitable conditions. The two strategies are identified on the wide levels that are identified as the strategic supply chain management and the Just in Time Policy. Both these policies are helpful in defining the suitable approach in the specific direction and with the help of these aspects; it could become easier to manage the perspectives and issues related to the SCM. Both these strategies are well organized, managed, object oriented and focused in nature. The quantifiable strategy is also considered in respect to Zara to manage the aspects in a suitable way (Tartaglia, 2011).
Apart from this, the maintenance of the customers’ goods and logistics in an appropriate manner is also identified as the best function carried out by the strategies defined for SCM.
The Inditex is the brand identity which acts as the supportive name in the field of introducing the concept of Zara in the world. The management for Zara Australia is also fully owned by Inditex by providing specific support to the production, manufacturing and selling facilities. Apart from these aspects, there are various other factors that are to be discussed on wide level to define the brand development in a well- defined manner (Mangan, et al., 2010).
Zara is identified as a team player in the other countries. But, it becomes difficult for Zara to enter into the local market of Australia. Apart from the entrance, the sustainability in the existing market is also recognized as the most important factor to be considered. For making the smooth flow of supply chain management and to manage logistics, the fashion brand introduces its various innovative projects in Sydney and Melbourne. To attract the customers, the brand also merges with the GAP and Victoria’s street. These products are successful in managing their brand identity worldwide and in the retail market of Australia. This merger not only helps in supporting the organization in making the financial aspects successful, but by this, the logistics and supply chain management of the organization can also be maintained in the right direction (Marufuzzaman & Deif, 2010).
The value analysis, brand credit and fidelity are identified as the most prompt method to approach the competitive advantages. The various components of the organization like the individual and participative learning, partnership, ecological learning and the other aspects will be helpful in defining suitable competition in a well approached manner. In the online report, Zara is ranked on 219, GAP is able to make rank under 400 and the Benetton is not able to secure any place. This shows the strengthened competitive aspects related to the organization.
The logistics and supply chain of Zara are designed in a different manner. This basic approach related to the organization makes it different from the other competitors in Australia. The comparative study of Zara is conducted in contrast to the Myers and Dell. The basic difference between three of them is that they belong to three different domains which are described as Dell is laptop making company, Myers is basically the departmental store and Zara is an apparel making organization (Lu, 2014).
Both the organizations are identified as strong market players. The consistency and innovative approach is identified as the most remarkable approach in a complete sense. But, still there are some aspects which show the differences. The tabular differentiation of both the aspects is shown below with the specific categorization. The difference is also defined on the basis of Australian aspects.
|
Criteria |
Zara |
Dell |
|
Approach |
The vertically approach is followed by Zara to manage the process of SCM. The production and manufacturing are totally managed by Zara on its personal basis. The task of designing and managing are also defined by Zara itself. |
The Horizontal approach is adapted by the Dell. Dell is mainly isolated from the production process. Rather than doing the production, the third party production system is identified on priority. |
|
Contributors of Supply Chain |
The designing, sourcing, manufacturing and distribution are identified as the major source of the supply chain. |
The Dell itself, supplier and consumers are identified as the major source of contributors of the supply chain. |
|
Production aspects |
The new and innovative designs are discovered every time. The products are manufactured in fewer amounts and the selling of these products will be helpful in providing suitable assistance. |
The make to order strategy is identified as the major aspect adapted by the Dell. This will be helpful in delivering the product to the customers as per their configuration. |
|
Suppliers |
Zara believes in providing the suitable products in a definite and short time frame (Bootwala, 2015). |
The Dell also provides the services in definite time frame, but still some risks relate to it, because some work is also managed by the third party vendors. |
|
Storage |
The storage capacity is very high. In Australia, there are various warehouses to store the products manufactured for the sale. |
The storage of Dell is not well identified. The inventory cost is very low and the storage cost is too high to manage. |
|
Mode of communications |
Zara is a fashion icon, so the order of communication is also managed by using the different sources of internet. |
The customer’s feedback and online orders are only identified as the major source to manage the communication in an appropriate way. |
|
Distribution |
The distribution channel and product demand are maintained on the specific demand of customers (Lopez, 2009). |
The indirect channel is helpful in selling the products. The B2B strategy is adapted for the suitable discussion |
Similarly, the comparative analysis between Zara and Myers will be successful in providing assistance to the supply chain management aspects defined in Australia. The Myers or commonly known as my store is specifically defined as the departmental store, which is helpful in providing basic need products. The distribution of the product is not identified on the demographic and psychographic basis, whereas Zara in Australia observes the demographic and psychographic conditions before initiating any new outlet. This will help in promoting the products in a specific direction. The market of Myers is ambiguous. The target market is also comprised with different categories of customers. On the other hand, the market of Zara is full of innovative approaches and changing trends. The customers range from 20-35 years of age who are keenly interested in purchasing the products. The customer service of Myers is not very approachable, the products are various in numbers, but very few customers get attracted. The Zara possesses specific customer services to serve its customers. There are various offers and promotional aspects applied for the customers in Australia (Orcao & Pérez, 2014).
This will be helpful in demonstrating differences in the supply chain of Zara and different organizations. The diagrammatic representation of the supply chain with differences is also shown below. Diagram 1 is defined for the logistics of Zara and Diagram 2 is specified for SCM of the other organizations.
Conclusion and Recommendation
After making the report for the supply chain and logistics of Zara, it can be concluded that Zara is identified as the brand icon in the fashion world. The internal value analysis of the Zara can be identified with the help of definite research. It is also identified that Zara is specific in providing the customer centric approach completely and also tries to provide suitable assistance in a specific manner. The other aspects which are covered in this report are related to strengthening the financial and economic aspects in the most coordinated manner. The comparative study provided in the report is also successful in delivering the basic difference between the logistics and supply chain management of other organization in contrast to Zara. The report is also successful in highlighting the major challenges and opportunity related to Zara while introducing the concept in Australia. Though the organization is doing very well in Australia, but still some of the recommendations are provided to manage the flow of work in a specific direction.
It is recommended that the more specific and planned steps should be taken in a definite manner to manage the working aspects in context to the organization. Before initiating any new venture, it is essential to manage the specific approach in a possible way. The market auditing and preparation of report is identified as the primary areas of concern. By following these approaches, it could become possible to establish the better identity of supply chain management and logistics of Zara in Australia.
References
Bootwala, H., 2015. Place – Success factor of ZARA, Available at: https://mpk732.wordpress.com/2015/05/19/place-success-factor-of-zara/
Chaudhuri, S. & Kowsmann, P., 2016. Zara Owner Inditex Stays Ahead of the Competition, Available at: https://www.wsj.com/articles/zara-owner-inditex-profit-beats-forecasts-1465968167
Crofton, S. & Dopico, L., 2012. ZARA-Inditex and the growth of fast fashion, Available at: https://www.ebhsoc.org/journal/index.php/journal/article/viewFile/216/218
Hume, M., 2011. The secrets of Zara’s success, Available at: https://fashion.telegraph.co.uk/news-features/TMG8589217/The-secrets-of-Zaras-success.html
Lopez, C., 2009. Internationalisation of the Spanish fashion brand Zara. Journal of Fashion Marketing and Management: An International Journal, 13(2), pp. 279 – 296.
Lu, C., 2014. Zara supply chain analysis – the secret behind Zara’s retail success, Available at: https://www.tradegecko.com/blog/zara-supply-chain-its-secret-to-retail-success
Mangan, J., Lalwani, C. & Butcher, T., 2008. Global Logistics and Supply Chain Management.: John Wiley & Sons.
Mangan, J., Lalwani, C. & Butcher, T., 2010. Global Logistics and Supply Chain Management, Available at: https://www.wiley.com/WileyCDA/WileyTitle/productCd-EUDTE00368.html
Marufuzzaman, M. & Deif, A., 2010. A dynamic approach to determine the product flow nature in apparel supply chain network. International journal of production economics, December.pp. 484-495.
Orcao, A. & Pérez, D., 2014. Global production chains in the fast fashion sector, transports and logistics: the case of the Spanish retailer Inditex. Sciencedirect journal, December, 2014(85), p. 113–127.
Schlossberg, M., 2015. This Spanish retailer with the ‘best business model’ in apparel is scaring Gap, Abecrombie & Fitch, and J. Crew, Available at: https://www.businessinsider.in/This-Spanish-retailer-with-the-best-business-model-in-apparel-is-scaring-Gap-Abecrombie-Fitch-and-J-Crew/articleshow/50251799.cms
Tartaglia, L., 2011. Zara’s Australian entrance to challenge local retailers, Available at: https://theconversation.com/zaras-australian-entrance-to-challenge-local-retailers-272
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