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Zara - PowerPoint PPT Presentation

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Zara. Our Team. Presentation Agenda. Introduction Competitors Updates Challenges Recommendations. Introduction. About Zara. Founded by Amancio  Ortega In 1975, the first Zara  store was  opened  in  La  Coruna, Spain

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Presentation Transcript
presentation agenda
Presentation Agenda






about zara
About Zara

Founded by Amancio Ortega

In 1975, the first Zara  store was  opened  in  La  Coruna, Spain

Inditex  was  formed  as  the  holding  company  atop  of Zara, other  retail  chains  &  a  network  of  internally

ownedsuppliers (1985)

about zara1
About Zara

Focused  on  opening  stores in  prime  city  locations

Rapid response to market demands

Offer new clothing styles faster than its competitors 

Inditexhas become one of the world's largest clothes makers in the fast fashion industry

1,671 branches in 78 countries worldwide

zara s supply chain
Zara’s Supply Chain

Maintains control over its

product design, manufacturing,

distribution & retailing operations

Consists of 4 Phases:


Closest competitor

Hennes and Maurtiz (H&M)

Founded on 1947, Sweden

Innovating around design and distribution

Supply Chain Phases

Design, Production, Distribution and Retail

h m s supply chain
H&M’s Supply Chain

Production Phase

Outsource production process

60% in Asia, 40% in Europe

Low production cost to maximize profit at Asia

Implications to Zara

No production outsourcing

Higher overall production cost

h m s supply chain1
H&M’s Supply Chain

Distribution Phase

Distribution center(DC) located at every country

Daily replenishment to increase stock turnover rate

Able to meet customer’s demand on time

Implications to Zara

2 Large DCs located in Spain

Slower replenishment rate

Unable to meet customer’s demand on time

h m s supply chain2
H&M’s Supply Chain

Retail Phase

40% lower product selling cost compared to most competitors

Implication to Zara

Higher product cost due to higher production cost


Challenges Zara faced against H&M

Higher production cost

Slower replenishment rate

Slower at meeting customer demand

updates on zara s scm1
Updates on Zara’s SCM

Retailer’s Work Process

Distribution Network and Centre

Inventory Management

retailer s work process
Retailer’s Work Process

Shifted to third party logistics providers

Shifted to factories

Enhancements made to PDA

distribution network and centre
Distribution Network and Centre

Consolidated transportation across Zara’s different brands

DCs are equipped to handle small scale customer orders

inventory management
Inventory Management

Implemented sophisticated inventory allocation model


Limitation of company wide interconnectivity

Obsolescence and Limitation of Technologies used

challenge 1
Challenge 1
  • Discrepancies between orders and sales data
  • More time and energy spent on administrative work
our recommendation
Our Recommendation

Run complete OS software

Useful functions for SCM execution

Gradually Replace PDAs


Timeliness and Correctness

Instant access and updates

Improve cycle time & efficiency

Employee Responsiveness

Better “reachability”

Scalibility & Updates 

More functionalities

challenges addressed
Challenges Addressed

Obsolescence of PDA Systems

Technical support issues

Limited Connectivity

Information Sharing

Data Discrepancy

feasibility evaluation
Feasibility Evaluation




Training for personnel

our recommendation1
Our Recommendation

Intuit-HP Retail Solution

HP’s POS Software

Full fledged Mouse & Keyboard

Industry-proven software

Gradual replacement of DOS systems 

Phased Approach


Interconnectivity between stores

Merging of data into one system

Precise measurement of stocks

Global trends and developments

Real-time information sharing

React faster to sales information

Improve decision making

challenges addressed1
Challenges Addressed

Limitations of Existing Network

Automatically collect and process data

Reduces need for calls & manual checks

Increasing obsolescence of DOS

Modern, widely supported OS

Reduce reliance on sole vendor

Future-proof their operations

feasibility evaluation1
Feasibility Evaluation

Staff adaptability to change

Need to ensure sufficient training

Empower staff to fully utilize system

Risks associated with change

Use phased implementation approach

Test stability on pilot stores


ZARA’s competitor (H&M)

The need to stay competitive

ZARA’s SCM updates

Importance of continual innovation

Challenges & Recommendations

Innovations through cutting-edge technologies