Zara was founded in 1963 by Amancio Ortega Gaona in La Coruna, Spain. It is known for its fast fashion business model and vertical integration of production. Zara uses a supply chain management system that allows it to design, produce and distribute new fashion items to stores twice a week based on customer demand. This pull strategy helps Zara reduce risks and costs while maintaining low inventories.

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ZARA’S SUPPLY CHAIN

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ZARA’S SUPPLY CHAIN MANAGEMENT
PRACTICES

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ORIGIN OF ZARA
FOUNDED BY : AMANICO ORTEGA GAONA
BORN IN : LEON, SPAIN IN 1936
A SALE FORMAT OF INDITEX GROUP - ONE OF THE WORLD’S LARGEST FASHION DISTRIBUTOR.
AMANICO ORTEGA PABLO ISLA
CHAIRMAN FIRST DEPUTY CHAIRMAN & CEO

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INTRODUCTION
• Ortega Worked As An Assistant In Apparel Shop And Set Up
Its Own Fashion Retail Business.
• 1963: Started Manufacturing Housecoats With Name As
Confecciones Goa .
• 1975: Estd A Small Outlet In His Factory And Called Outlet
As Zara.
• 1979: Estd A Company With Name As Industria De Diseno
Textil ,Sa, Whose Flagship Brand Was Zara

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SUPPLY CHAIN MANAGMENT
• Supply chain management (SCM) is the management of a
network of interconnected businesses involved in the
ultimate provision of product and service packages required
by end customers .
• Supply Chain Management spans all movement and storage
of raw materials, work-in-process inventory, and finished
goods from point of origin to point of consumption.

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SALIANT FEATURE
• Customize Retailing
• Vertical Integration of Production System
• Exclusive Production
• Involvement of Manager, Staff and Owner
• Reduce time due to Team Work
• Policy for Franchisees.

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INFORMATION FLOW FROM
CUSTOMER TO COMPANY

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DESIGNING
• Adapting new design
• Shelf life of design
• High Fashion concept
• Always Introduce fresh design
• Designer travel world wide
• Computer Aided Design

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Production
• Demand based production
• Flexibility

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DISTRIBUTION
• Central site for distribution
• High accuracy in Shipment
• Efficient Supply Chain
• Own Railway Infrastructure
• Straight away display of product

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STORE OUTLAY
• Uniform store outlay
• Store Outlay at Prime location
• Store window designer
• Display of clothes

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ADVANTAGE
• React quickly to market demand
• Fast Supply worldwide
• Anticipation of product
• Product quality and design
• Highly Flexible Production System
• Automated Distribution System
• Low Risk for limited product
• Supply chain for maximize revenue
• Pull Strategy
• Maintain Low Inventory

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DISADVANTAGE
• Higher Cost
-Distribution
-Labor
• High competition
• Lack of economies of scale

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