As completely as possible, sketch the supply chain for Zara from raw materials to consumer purchase.
The supply chain
at Zara begins with the facility manufacturing its fabrics to be used in
designing its apparels. The retailer does not, in any way, rely on suppliers
but opts to produce all raw materials local to save precious time that would
have been spending outsourcing the same
to South East Asian countries. Designs are sent to local cooperatives where
sewing is done, after which they are returned to the facilities to be ironed by
different specialists. After being wrapped in plastic, they are then
transported to the warehouses where customized machines process the parcels
before transportation by either trucks or ships to stores where consumers can
now get them
Discuss the concepts of horizontal and vertical conflict as they relate to Zara.
system relies on its own private team of creative minds to come up with
concepts and designs that would use in creating
a specific item. Every activity carried out by the company or retailer is done
internally without counsel or ideas that originate outside it. Zara is an
exception to this rule and chooses to embrace vertical conflict. The store does
this by first consulting store owners who are their eyes and ears in as far as
trends are concerned. They essential act as trend spotters whose primary task is to provide creative designers
at Zara headquarters with real-time updates on what they need to out in the
market. Managers receive this information from their personal digital
consultants who have been tasked with ensuring that information on the latest
trends reaches them promptly. They then proceed to implement this information,
creating new designs for consumers.
Which type of vertical marketing system does Zara employ? List all benefits that Zara receives by having adopted this system.
Zara employs the
corporate system found in the vertical marketing system to manage the manner in
which business is run in the retailer. Activities are centralized, with the
overall head of the conglomerate owning all other members of the distribution
channel. In essence, the business is under the leadership of a single entity,
making it rather easy for activities to be conducted without any operational
hiccups. The advantage of this system lies in the company increasing its market share, which means it no
longer relies on facilities in other countries to manage its distribution.
Moreover, it’s vital to also note that the logistics are streamlined which
ensures that ownership remains under a single individual.
Does Zara experience disadvantages from its “fast-fashion” distribution system? Are these disadvantages offset by the advantages?
disadvantage of using the “fast-fashion” model, as is the case in with Zara is
its unsustainable nature. The products and designs that are produced have a
relatively short product life cycle, which means that the imitated products can
only be on the shelves for a relatively shorter period. The disadvantage of
employing this business model lies in the losses that would be made when the
population targeted fails to purchase the products. The distribution also
presents logistical complexities, especially when it is clear that the retailer
owns all its supply channels. Even with these few disadvantages, they do not
offset the advantages of this system since the firm has its researchers who
investigate the popularity of a certain trend before deciding whether or not to
embark on production.
How does Zara add value for the customer through major logistic functions?
Zara adds values
for its customers by always ensuring that its designs are locally produced,
avoiding outsourcing by all means possible. By so doing, the time factor that
often troubles other retailers is considerably lessened, allowing the consumers
to receive the products in less than two weeks. Furthermore, they also have an
opportunity to make suggestions on what they would be requiring at any given
moment by communicating the trends with the shop owners. The ideas are then
relayed to ‘the headquarters where a group of creative minds to work to ensure
that these designs are produced promptly and ready for all those requiring
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