Zara Business Model

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Zara is vertically integrated, designing, producing and distributing apparels through self-owned retail outlets. Effective communication and integration are the critical success factors. Zara has developed a highly responsive supply chain that enables delivery of new fashions as soon as a trend emerges. • Zara delivers new products twice each week to its 1,763 stores around the world. • Rather than subcontracting manufacturing to Asia, Zara built 14 highly automated Spanish factories, where robots work around the clock cutting and dyeing fabrics and creating unfinished “gray goods,” the foundations of their final products. • Zara has also created a partner network of more than 300 small shops in Portugal and Galacia to handle the finishing work where, the gray goods are transformed into dresses and suits. Strengths 1.Cost leadership strategy 2.Efficient distribution 3.Information technology 4.Fast delivery of new products ,and trends Weaknesses 1.Centralized distribution system 2.Doesn't spend much money on advertising 3.Zara only has one manufacturing and distribution centre in the world Opportunity 1.Global market penetration 2.Online market 3.Distribution centre in us Threats 1.Local competitors 2.Global competitors 3. Zara based in Spain and has a huge no of stores in Europe will dent in revenues. ara controls and coordinates perfectly all the process and allows reducing the times to minimums. Zara provided a considerable number of products, which were more than rival corporations in the fashion industry. It produced approximately 11,000 different products per year, while its major rivals only produce 2,000 to 4,000. Zara spent four to five weeks on the process of designing a new product and getting finished products in its stores . So, Zara already was the leading brand in `fast fashion’. Zara could redesign existing products in no more than two weeks. Zara

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