Zara–Rapid Fire Fulfillment |
Unit 1 Assignment 1 |
Capella University |
This paper explores the case of Zara–Rapid Fire Fulfillment from research conducted in textbook and on website.
Keywords: Supply Chain, Supply Chain Management
Zara-Rapid Fire Fulfillment
Zara is a company that is known for its speed and being responsive over the cost. While this is not how the industry looks at producing clothing in the marketplace, it has worked very successfully for Zara.
Amancio Ortega founded Zara in 1975 with the purpose of understanding the world market and what it means to his fashion merchandise. Ten years after he ...view middle of the document...
For their supply chain to be successful, there are several variables that have to take place that goes along with the philosophy of “fast fashion”.
Next, their production, while this is a controlled, integrated process, the company has to deliver fashion to many different tastes of the consumers. Zara keeps production of the products primarily in-house and make sure their factories have 85% capacity available for “in-season” adjustments. By doing this the company has the ability to be flexible on the amount, type, and frequency of new products that are coming out. In addition, they also rely on their design facilities headquarters in Spain for fabric sourcing, cutting and sewing even though the cost of the workers is extremely higher, the turn-a-round time is bar none.
Zara is one of the leaders in the industry when it comes to inventory management. For the company to do this, they have put an Inventory Optimization Model in place to aid in the determination of quantity of shipments to each store weekly. By using this methodology, Zara’s distribution center can provide smaller batches so that there is not an abundance of overstock.
Centralized logistics is a different approach than many other companies currently do that sets Zara apart from the rest. Majority of Zara’s competitors outsource their logistics which increase overhead within their supply chain. According to Felipe Caro, 2015, “the secret to their (Zara’s) success has been centralization”. They never deter from their predictable and fast rhythm based around order fulfillment to stores. For this to be orderly, the chain has to happen like clockwork. As stated in the Harvard Business Review, 2004,...