ZARA SUPPLY CHAIN FINAL ASSIGNMENT

OVERVIEW OF THE STUDY

Reasons for choosing the topic

The term "supply chain," often referred to as "logistics" internationally, plays a vital role in the import and export sector, especially for commercial and industrial businesses Efficient supply chain operations, including forwarding and freight forwarding activities, are essential for ensuring the timely delivery of goods to customers and consumers.

The success of supply chain management operations has a significant impact on the prompt, accurate, and timely supply and distribution of items

It can be observed that the supply chain is essential and necessary for any organization, particularly manufacturing businesses, such as Zara, a globally recognized apparel brand

Therefore, this topic aims to analyze, evaluate and make comments on "The current situation of Zara's supply chain".

Research objectives

Objective overview: Analyze, evaluate and make comments on "The current state of Zara's supply chain"

This article aims to analyze Zara's unique supply chain model, highlighting its strengths and weaknesses, while also comparing it to competitors within the fashion industry It will explore how Zara's supply chain has evolved before, during, and after the pandemic, providing insights into its adaptability and resilience in a rapidly changing market.

Research methods

This essay aims to gather data to identify the most effective solutions by utilizing information from various sources Through thorough analysis and evaluation, it seeks to develop solutions and provide insights on issues related to the objectives of the topic.

Significance of the study

See the importance of the supply chain in the business model of a business

Impact of the Covid 19 pandemic on business activities in general and the Zara supply chain model in particular

Methods to improve the existing weaknesses in the operation of the Zara supply chain, helping to have better innovations and improvements with the supply chain.

Structure of the report

Chapter 1: Overview of the study

Chapter 3: The reality of Zara's supply chain

Chapter 4: Solutions and Recommendations For New supply chain

LITERATURE REVIEW

Define key concepts

2.1.1 The concept of supply chain

A supply chain encompasses the network of organizations, individuals, activities, information, and resources that facilitate the movement of products or services from producers to consumers Supply chain management plays a crucial role in integrating essential business functions and processes, creating a cohesive and efficient business model Given the diversity of industries and sectors, the definition of supply chains can vary significantly, reflecting the unique characteristics and requirements of each field.

2.1.2 The concept of Fast Fashion

Fast fashion refers to a business model in the apparel industry that quickly replicates current runway trends and high-quality designs at significantly lower prices This approach allows retailers to respond rapidly to consumer demand, ensuring that trendy clothing is available in stores when it is most sought after.

Introduction about Zara

Zara is a Spanish clothing and accessories brand Headquartered in Arteixo, Galicia Founded in 1975 by Amancio Ortega and Rosalia Mera

Zara, the flagship brand of the Inditex Group, stands as the largest fashion retailer globally This prominent fashion conglomerate also encompasses several well-known brands, including Massimo Dutti, Pull and Bear, Bershka, Stradivarius, Oysho, Zara Home, and Uterqüe.

Factors that create success for the Zara brand

2.3.1 Create new ones based on existing ones

Zara has faced criticism for producing "fake goods" due to its designs resembling those of well-known brands Despite this, the retailer continues to thrive and sell out its products This success can be attributed to Zara's keen ability to listen to customer feedback and rapidly adapt its offerings based on trends set by other brands.

Zara distinguishes itself by forgoing the hiring of renowned designers, instead focusing on gathering global consumer feedback and integrating it with its own design concepts This approach results in a unique fusion of styles, reflecting elements from various high-profile fashion brands, such as the casual aesthetic of Gap, the elegance of Prada, and the refined sophistication reminiscent of Gucci.

In the fast-paced world of fashion, trends reign supreme, and Zara's dedicated team of 300 designers excels at delivering new styles at lightning speed Their ability to produce innovative designs rapidly leaves competitors in awe, solidifying Zara's position as a leader in the industry.

If other brands take months or even years to launch new products, Zara only takes about 1 to 2 weeks to do so

2.3.3 Success of Zara: variety of designs, but small quantity

Zara strategically creates a sense of scarcity by limiting the production of its designs, ensuring that products are available in limited quantities This approach encourages customers to make quicker purchasing decisions, as they fear missing out on items that may soon sell out As a result, Zara's stores frequently experience low stock levels, with no inventory remaining in warehouses for more than four weeks.

To address the limited availability of products with identical designs, Zara consistently focuses on offering a diverse range of innovative styles This strategy not only caters to a broad audience but also provides customers with an extensive selection of options to choose from.

2.3.4 Cheap price but good quality

Zara's effective pricing strategy has significantly contributed to its success, attracting customers who appreciate the brand's reputation, comparable to luxury labels like Gucci and Prada, yet offered at prices 2 to 3 times lower With a focus on high-quality, trendy designs at more affordable rates, Zara presents an irresistible choice for consumers.

For Vietnamese people, with just 500,000, it is possible to own an outfit and accessories of the world-famous Zara fashion brand

2.3.5 Don't spend money on advertising, but spend money on standing next to big brands

Zara operates without an advertising budget, opting not to spend on traditional marketing Instead, the brand strategically positions itself alongside popular labels, effectively enhancing its image through this clever "brand upgrade."

Zara may not frequently appear in magazines or media, but its stores are strategically located alongside high-end brands like Gucci and Prada Price-sensitive customers often opt for Zara, as it offers stylish options at a fraction of the cost without compromising on quality.

Success of Zara and the Supply Chain

Is the philosophy of "fast fashion" the guideline for the supply chain operation that determines the incredible success of this "fast fashion king" from Spain?

Zara's supply chain is vertically integrated and highly responsive, allowing for garment exports every day of the year This efficiency enables the brand to deliver new products to stores twice a week, with items taking only 10-15 days from design to arrival on the sales floor.

Zara's main distribution center in Spain plays a crucial role in processing all garments, where new products undergo inspection, sorting, labeling, and distribution Typically, items reach stores within 48 hours, supporting Zara's impressive output of over 450 million items and 12,000 new designs each year This high level of supply chain efficiency is essential for maintaining a seamless and effective in-store collection renewal.

● How often customer insights are collected: Daily trending information is fed into a database at headquarters, then used by designers to create new lines and modify designs now available

● Standardize product information: Zara warehouses have standardized product information with consistent definitions, allowing for speedy and precise design preparation with clear production instructions

Zara excels in product information and inventory management, enabling the brand to efficiently handle thousands of fabrics, cuts, and design specifications This effective management allows Zara to create new suits using only the raw materials that are readily available, ensuring a streamlined design process.

● Procurement strategy management: To save money through demand aggregation, around two-thirds of undyed textiles are acquired before the design is finished

Zara employs a "make and buy" strategy, producing trendy and riskier items in Spain while exporting standard designs to countries like Morocco, Turkey, and Asia, where demand is more stable and manufacturing costs are lower The company's riskier products are primarily made in its own factories located in Galicia, northern Portugal, and Turkey, which together account for nearly half of its inventory In contrast, basic clothing items, such as t-shirts with predictable demand, are sourced from low-cost suppliers in Asia.

● Distribution Management: People run the operations in ZARA's state-of-the-art distribution facility And every hour more than 60,000 items of clothing are sorted and distributed by optical readers

THE REALITY OF ZARA’S SUPPLY CHAIN

Zara’s Supply chain model

As shown below, The supply chain management of ZARA is divided into 4 categories:

Zara's product design process is a collaborative effort involving a dedicated commercial team of designers, market experts, and buyers, with designers playing a pivotal role Each year, the brand creates approximately 40,000 unique products, from which around 10,000 are ultimately chosen for production.

Teams performing on both next season's design and concurrently updating the season's design to remain competitive

Zara draws design inspiration from a variety of global sources, such as catwalks, magazines, trade shows, and nightlife Each year, the brand launches two main collections—fall/winter and spring/summer—after a nine-month design process that begins with initial sketches These sketches are then refined using CAD software, focusing on enhancing the weave, texture, and color The designers finalize the materials and components, while also determining the future pricing of the products Sample presentations precede the selection process by the sourcing and development unit, which assesses whether items will be produced in-house or outsourced This unit also establishes a timeline to ensure that the initial collection is ready before the sales season begins.

Figure 3: Zara Supply Process in full

Zara designs all of its products it's a “commercial team” including designers, market experts, and buyers they're all involved within the detailed design of the products, the

9 designers are the key players Nearly 40,000 products are designed every year out of 10,000 selected for production

Teams acting on both next season's design and concurrently updating the season's design to remain competitive

Zara draws design inspiration from a variety of global sources, including fashion shows, magazines, and nightlife The brand produces two main collections each year: one for fall/winter and another for spring/summer Approximately nine months prior to each season, designers create initial sketches, which are then refined using CAD software to enhance the fabric's weave, texture, and color The designers finalize the materials and components, determining the future retail value of the products Samples are presented for selection before the sourcing and development phase begins The sourcing unit then assesses production needs and decides whether to outsource manufacturing, while also establishing a timeline to ensure that the initial collection arrives before the sales season starts.

Zara's extensive global network makes timely raw material distribution essential, necessitating robust and reliable transport logistics To avoid last-minute rushes, the company strategically orders materials well in advance of seasonal collections With a flexible shipping infrastructure, Zara ensures the prompt delivery of both raw materials and finished products Most fabric suppliers are based in Europe and Spain, facilitating quick shipments, while additional raw materials are sourced globally, primarily from Hong Kong and other Asian countries.

Zara's centralized distribution system enhances its competitive edge by significantly decreasing lead times for goods The company consolidates all shipments from Spain through a vast network of 600,000 square meters, complemented by smaller hubs located in Argentina, Brazil, and Mexico.

Zara operates four primary warehouses in Spain that handle incoming shipments of finished clothing from both internal and external suppliers across Europe and various global regions These completed products are dispatched to Zara stores worldwide twice a week.

Zara maintains a dynamic inventory system with regular deliveries and seasonal updates, ensuring that new item samples are included in each shipment to keep store stock fresh Rigorous inspections are conducted to identify any defects, and only quality products are shipped immediately The brand adheres to a strict policy of minimizing stock retention, ensuring that goods do not remain in inventory for extended periods.

Items are promptly shipped upon arrival from various suppliers after thorough inspection To enhance delivery speed, shipments are organized based on time zones, with goods transported by land or air Stores near Spain benefit from road transport, while the remaining items are dispatched via international airmail for expedited delivery.

Figure 6: Basic logistic flow of Zara

Zara has almost 2,200 locations in 96 countries In the US currently open 99 locations, and the majority of its locations totaling 464 are in Spain (including ZARA Home)

Zara's approach is to have a greater number of items available than its competitors While most clothing companies develop and sell 2,000 to 4,000 distinct items each year,

Zara produces approximately 10,000 unique pieces annually, allowing the brand to cater to a diverse clientele with varying tastes This distinctive manufacturing strategy has enabled Zara to expand its appeal across a broader market.

Their stores act as community hubs for consumers and serve as powerful promotional tools for the brand By establishing locations in major cities worldwide, they bring their unique fashion offerings to the high street, consistently showcasing the brand's authentic signature with an original and distinctive flair.

Zara's corporate philosophy emphasizes design, continuous innovation, and rapid response to consumer needs, which are reflected in its store architecture The development of each store is seen as an ongoing process that relies on collaboration across various departments While each location is tailored to fit its unique cultural and environmental context, they all adhere to a consistent set of principles Additionally, Zara's architectural projects often involve the renovation of historic buildings and comprehensive rehabilitation efforts in specific areas, showcasing their commitment to local adaptation.

Zara's main objective is to link customer demand with manufacturing and distribution processes By implementing short manufacturing cycles, minimizing inventory risk, and offering a diverse clothing range, Zara has established a unique value proposition and effectively shaped its current business strategy.

Zara's fundamental strategy revolves around agile design, production, and distribution systems that enable rapid adaptation to fluctuating consumer demand, even in the face of forecasting difficulties Their efficient manufacturing and distribution methods ensure that the latest styles are delivered in under three weeks, which enhances customer visit frequency and increases revenue Additionally, Zara's distinctive approach to advertising and marketing, which involves minimal investment at just 0.3 percent of their total revenue, plays a significant role in their overall success.

Zara maintains a competitive edge in marketing and advertising by leveraging low marketing costs and utilizing shop style, strategic locations, and short product lifespans to attract customers The company's senior executives prioritize tapping into the expertise of all employees, fostering a culture of trust that enhances their understanding of public fashion trends and enables them to design clothing that resonates with consumers.

The fashion industry is characterized by its volatility, with changing consumer preferences and demand To address these challenges, Zara has implemented three key strategies to satisfy client needs The initial step involves placing orders, which includes both the restocking of existing products and the introduction of new items This process emphasizes speed and decisive action, as stores are assigned strict deadlines to replenish current inventory If they do not meet these deadlines, the headquarters in La Coruna processes a "replenishment-only" order to ensure customer requests are fulfilled.

Zara’s supply chain strengths and weakness

What are Zara’s major strengths?

Pioneer Advantage: Fast-fashion brands like Zara excel in rapidly creating, manufacturing, and marketing clothing as soon as new trends emerge, a process that typically takes months in traditional fashion Zara's innovative approach allows them to complete this cycle in just three weeks, showcasing their advanced supply chain strategy and management techniques, positioning them as leaders in the industry.

Zara operates in 96 of the 202 markets it serves, boasting a remarkable presence with more fashion boutiques than any other brand, totaling over 2,249 locations—more than double that of Nike, which ranks second in retail locations.

● Supply Chain: Twice a week, ZARA will update the collections online in stores

ZARA operates up to 10 logistics centers, ensuring global delivery of goods within 48 hours Additionally, Inditex boasts an in-house software development team focused on enhancing the speed of order fulfillment.

● Design Team: Inditex employs 700 educated designers who turn customers' aspirations into designs The product design team creates 50,000 works per year

And it only takes them 3 weeks to bring from the design at the drawing board to the sales shelf

Inditex is set to invest $3 billion to enhance its online sales, aiming to create an engaging shopping experience while integrating its existing physical infrastructure The company targets generating 25% of its revenue from online sales by 2022.

Zara's success in the fast fashion industry stems from its mastery of rapid production and trend responsiveness However, the concept of "fast fashion" raises significant concerns regarding environmental impact and issues of plagiarism, which are pressing matters in today's society In the upcoming section, we will delve into "Zara's weaknesses" to explore these critical challenges further.

The next strength that Zara can establish a versatile Supply Chain lies within the following unique approaches to provide chain success:

Zara's Purchasing team focuses on the quantity of raw materials required for garment production rather than the finished clothing amounts This approach enhances sustainability and reduces costs by minimizing waste, allowing for the reuse of materials However, they refrain from reselling garments if any part does not meet quality standards, ensuring that only high-quality products reach consumers.

● Extensive collaboration: Supplier ties are crucial, as suppliers are adjacent to Zara's factories and collaborate closely, allowing Zara to place orders on a daily basis

The shop manager delivers daily consumer feedback to market specialists, who relay this information to the design and manufacturing teams This efficient feedback loop allows for swift and adaptable responses to market demands.

Zara employs a distinctive local production strategy by manufacturing its products in Galicia, focusing on items with more dynamic designs rather than outsourcing to Asia or Eastern Europe This approach, while potentially higher in cost, offers significant advantages such as quicker time to market, reduced transportation expenses, and decreased vulnerability to fluctuating tariffs and political changes, ultimately enhancing Zara's competitive edge in the fashion industry.

15 wide, global supply networks, this minimizes total supply risk by focusing on a smaller pool of hazards This also contributes to a reduction in overall carbon footprint by reducing transportation

Zara strategically maintains a backup capacity by idling up to 85% of its manufacturing, allowing for rapid responses to global demand fluctuations This approach contrasts sharply with competitors who focus on maximizing utilization, highlighting Zara's unique operational strategy.

Zara employs highly effective demand forecasting and inventory management algorithms to accurately assess the needs of each store By dispatching small quantities twice a week, they create a sense of scarcity that minimizes unsold goods Their responsive supply chain allows for quick adjustments and testing of new models, ensuring that Zara consistently identifies the right products for their customers.

What are some of Zara’s weaknesses?

Zara distinguishes itself from other fashion brands through its unique commitment to updating its collection every two weeks This dedication to rapid inventory turnover has been a significant factor in Zara's rise to the top of the fashion industry However, this competitive advantage also comes with associated costs that the brand must manage effectively.

The rise of fast fashion has propelled ZARA to prominence, yet this very success highlights a significant flaw in its business model As sustainability gains traction among consumers, the contrast between eco-friendly practices and fast fashion becomes increasingly problematic for ZARA.

The pandemic has accelerated Zara's strategy to reduce its reliance on physical stores, as the brand adapts to changing consumer behaviors While online sales have helped mitigate the impact of COVID-19-related challenges, overall sales still remain at just 89 percent of their 2019 levels.

Zara has 99 locations in the United States and Asia-Pacific Zara's 2249 outlets account for only 4.4 percent of the total However, the United States is the world's largest

16 clothing market In addition, Asia-Pacific accounts for 38% of the global clothing market Zara has a little presence in both regions

Inditex collaborates with 1,520 suppliers across 7,108 factories, all adhering to ethical labor practices While the company has established a stringent code of conduct, there remains a notable discrepancy in its enforcement This issue is underscored by a Buzzfeed report detailing employee abuse in Myanmar.

Inditex is partnering with AI and Big Data companies to create an advanced AI-driven system designed to predict customer behavior Currently in the testing phase, this innovative system promises to give Zara unparalleled capabilities in forecasting and satisfying customer needs once fully operational.

Solution for a fast fashion model - How can Zara forecast and respond well to

Zara's unique strategy involves avoiding product discounts to sustain limited production quantities, which plays on customer psychology This approach creates a sense of urgency, making shoppers feel that even if they purchase slowly, prices remain high, and if they wait too long, their desired items may sell out.

In the event of inventory challenges akin to those experienced during the Covid pandemic, brands like Zara are opting to cut their labels and donate their goods rather than destroy them or lower prices, thereby avoiding criticism for luxury waste and protecting their brand reputation through charitable contributions.

Zara has consistently prioritized customer feedback by closely monitoring fashion trends and understanding consumer needs through sales staff and store managers To enhance this process, implementing a direct feedback mechanism, such as a Zara app, could streamline customer requests straight to the head office database, further improving responsiveness to customer preferences.

Zara is launching a gifting program to incentivize customers to download the app and provide feedback, offering exclusive limited edition accessories to lucky participants.

Compare the supply chain model between ZARA and other traditional retailers

- Global business model, vertically integrated

- Use a group of factories in Spain to do the initial cost-intensive tasks such as dyeing, cutting fabrics

=> Take advantage of scale (making a larger quantity will cost less than making a small quantity at each stage) to minimize costs

- Use different factories to perform machining operations

=> Increase economies of scale => Reduce costs

The rapid transition from production to retail store arrival within just three weeks enables a swift response to evolving customer preferences and emerging fashion trends, providing a significant short-term competitive advantage.

Zara consistently launches new products year-round, beyond its primary winter and summer seasons, offering up to 26 collections for men annually This strategy is made possible by its efficient production process, allowing the brand to introduce an impressive 11,000 new items each year, thereby enhancing customer demand.

=> Differentiate yourself from the competition:

Zara efficiently monitors its retail inventory through its staff, allowing for real-time tracking of product availability on store shelves without the need for prior predictions By utilizing a vertical supply chain, Zara simplifies its ordering process, requiring only a monthly communication with factories to determine order quantities, eliminating the necessity for frequent checks.

+ Retail stores will place orders twice a week, managers will manage stock at the store using a handheld device, it will notify exactly what items are available and how

18 much, when which managers will place orders at factories This makes Zara no inventory => Reduce inventory costs => Reduce costs

+ The marketing team introduces new products to retail stores, in order to survey customers' tastes for new products => This helps Zara accurately predict customer demand for new products

Implementing a conveyor system for retail store supply ensures that orders are delivered within 1 to 2 days, allowing new goods to consistently be available on shelves without delay This efficient logistics solution enables retailers to respond swiftly to consumer demand, enhancing customer satisfaction and driving sales.

Avoid selling online to minimize revenue management costs, as online revenue management is complex and customer orders tend to be limited This makes it challenging to leverage the economies of scale typically found in processing factories.

Zara has effectively recognized the ever-changing needs of its customers, understanding that adaptability is crucial in the garment industry By implementing a responsive strategy, Zara has gained a competitive advantage over other brands, allowing it to swiftly meet customer demands and preferences.

On average, in the apparel industry, it takes more than 6 months from design to sale Zara did this in about 5 to 6 weeks

Zara's rapid production speed enables the brand to launch new products weekly and refresh approximately 75% of its inventory every 3 to 4 weeks This agility in product offerings makes Zara a preferred choice among customers, leading to the brand selling the majority of its items at regular prices, in contrast to competitors who typically sell around 50% of their products at discounted rates.

Until 2002, Zara concentrated its operations primarily in Europe, utilizing a central distribution center in Spain along with several satellite distribution centers in Latin America to manage its global logistics This strategic approach enabled efficient deliveries from distribution centers to retail stores.

19 are made twice a week This allows stores to better respond to customer needs After growing, Zara built an additional distribution center in Spain

Unlike many competitors that rely on inexpensive labor in Asian countries to cut costs, Zara prioritizes production in Spain and Northern Portugal This strategy enables Zara to swiftly deliver products to customers, emphasizing the critical importance of speed in the fashion industry.

During the off-season, Zara outpaces its competitors by producing a larger volume of discounted products While these discounted items are more affordable, they often do not match the quality of products sold at regular prices This strategy allows Zara to achieve higher profits compared to its rivals.

- Minimize costs through economies of scale

- Create differentiation by regularly launching new products and responding quickly to the needs of new tastes and fashions, through short shipping times to retailers.

ZARA supply chain before, during, and after COVID - 19 and solutions given

Zara, a prominent player in the fast fashion industry, offers trendy collections that rival the quality of higher-end brands while maintaining more affordable prices Since entering the Vietnamese market in 2016, Zara has demonstrated consistent growth and quickly gained popularity among local consumers, surpassing sales of competitors like Blue Exchange, Ivy Moda, and Kowal However, the COVID-19 pandemic significantly impacted Zara's sales in Vietnam, presenting challenges for the brand.

However, the Covid-19 pandemic that began in early 2020 has dealt a heavy blow to many economic sectors, including the fashion retail industry To prevent the pandemic,

20 many countries have imposed a prolonged blockade that forced all shops to close Without exception, 88% of Zara's stores around the world had to temporarily close

As a result, in the first quarter of the company's financial year, from February 1,

As of April 30, 2020, the group's revenue experienced a significant decline of 44%, totaling 3.3 billion euros, alongside a net loss of 410 million euros, a stark contrast to the profit of 734 million euros reported in the same period of 2019 By June 2020, amid the ongoing pandemic challenges, Zara announced the closure of 1,200 out of its 7,412 global stores, representing approximately 20% of its locations, primarily affecting stores in Europe and Asia.

During the blockade, Zara's online sales service proved effective in mitigating revenue losses, showcasing the brand's commitment to digital technology By 2022, Zara aims to enhance online sales, with larger stores serving as distribution centers Inditex, Zara's parent company, outperformed H&M in recovery efforts, achieving second-quarter sales that surpassed pre-pandemic levels A key goal for Zara is to accelerate the rollout of its 'integrated store' concept, catering to customer needs across all devices and times Recent reports highlight the unprecedented significance of e-commerce, which has evolved from a supportive role to a central one due to COVID-19 and changing consumer behaviors Despite the recovery, the emergence of the Delta variant has led to renewed restrictions, while the fashion industry grapples with supply chain challenges, including shipping container shortages.

SOLUTION AND RECOMMEND SUPPLY CHAIN FOR ZARA

Solution

In light of the supply chain disruptions caused by Covid-19, it is crucial to identify effective strategies that enhance flexibility and responsiveness within the supply chain Implementing adaptive measures and proactive actions can significantly improve supply chain resilience, ensuring smoother operations in the face of future challenges.

Develop high-risk response and monitoring programs for supply chain disruptions for countries affected by Covid-19, and tier-1 supply exposure go down

Efficiently program and prioritize supplies to gain a comprehensive and timely overview of inventory Ensure that all stock is easily accessible and located away from impacted areas and logistics centers Furthermore, supply chains must collaborate with human resources and legal departments to evaluate financial implications and effectively address customer inquiries.

The focus now is on balancing supply and demand as well as building an estimated supply Assess opportunities and risks to diversify the company's supplier ecosystem

Once the initial effects of the crisis are mitigated, continue to anticipate future circumstances This is the time to reevaluate or develop alternative sources and diversify the value chain

To minimize major disruptions, it is crucial to address and centralize strategic and high-risk supplies by evaluating their original acceptability This includes exploring alternative sources, routes, inventory management, and maintaining adequate cash reserves when current supplies are insufficient.

Zara has consistently prioritized customer feedback, swiftly adapting to fashion trends to better anticipate consumer needs By leveraging insights from sales staff and store managers rather than solely relying on senior experts, Zara can enhance its responsiveness Implementing direct feedback channels, such as a dedicated Zara app, could further bridge the gap between customers and the brand, ensuring a more streamlined approach to understanding and meeting customer preferences.

22 directly send customer requests to the head office database, improving the speed at which information from customers is received faster

Figure 7: Zara’s new supply chain model

Many companies want their supply chain to have a primary goal of reducing costs

As for Zara, the supply chain must operate at maximum speed, thereby increasing revenue to offset labor and transportation costs and at the same time ensure customer satisfaction

Zara's remarkable success can be attributed to its distinctive business philosophy and innovative supply chain management The brand's "fast fashion" approach has transformed it from a traditional fashion retailer into a prominent case study in modern business practices.

APPENDIX – TEAM OF TASK IN THE US GROUP Contents to be done Students perform

1.1 Reasons for choosing the topic

Pham Thuy Hien Pham Thuy Hien

Ha Thi Thu Huyen Nguyen Thi Anh Tuyet Nguyen Thi Anh Tuyet

2.3 Factors that create success for the Zara brand

2.4 Success of Zara and the Supply Chain

Pham Thuy Hien Nguyen The Trung Nguyen The Trung

Ha Thi Thu Huyen Nguyen Thi Anh Tuyet Nguyen Hoang Nhat Quyen

3.2 Zara’s supply chain strengths and weaknesses

3.3 Solution for a fast fashion model - How can Zara forecast and respond well to customer needs?

3.4 Compare the supply chain model between ZARA and other traditional retailers in the industry

3.5 ZARA supply chain before, during, and after

COVID - 19 and solutions given to deal with covid-19

Nguyen Hoang Nhat Quyen Nguyen Thi Anh Tuyet Nguyen The Trung

Nguyen The Trung Nguyen Hoang Nhat Quyen

2014: http://www.inditex.com/es/investors/investors_relations/annual_report

2 HUGAS, J La Moda Rápida de Zara (2014) (ESADE Business School Case)

3 WELLS, J., DANSKIN, G Inditex: 2012 (2014) (Harvard Business School Case)

4 GHEMAWAT, P., NUENO, J.L Zara: fast fashion (2006) (Harvard Business School

5 LOEB, W Zara leads in fast fashion Forbes

(03/30/2015) http://www.forbes.com/sites/walterloeb/2015/03/30/zara-leads-in-fast- fashion/

12/5/2015) http://about.hm.com/es/About/facts-about-hm/fashion-for- all/collections/collaborations.html

7 Fashiongear.fibre2fashion, ZARA, Visual Merchandising, http://fashiongear.fibre2fashion.com/brand-story/zara/visual-merchandising.asp

8 StudyModeResearch, Feb 8th, 2015 Published, Answers to Zara Case, https://www.studymode.com/essays/Answers-To-Zara-Case-67640239.html

9 AMRITH SUDHAKARAN (OCT 27, 2020),PESTLE ANALYSIS, Zara SWOT

10 Vishal Patel (May 6, 2020), ivalua, Zara – a Masterclass in Supplier Relationships and Supply Chain Management, https://www.ivalua.com/blog/supply-chain- management-zara/

11 Sarah Hippold (November 18, 2020), Gartner, Coronavirus: How to Secure Your

Supply Chain, https://www.gartner.com/smarterwithgartner/coronavirus-how-to- secure-your-supply-chain

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Simchi-Levi New York, NY: McGraw-Hill, 2002 267-279 Print.

Conclusion

Many companies want their supply chain to have a primary goal of reducing costs

As for Zara, the supply chain must operate at maximum speed, thereby increasing revenue to offset labor and transportation costs and at the same time ensure customer satisfaction

Zara's remarkable success can be attributed to its distinctive business philosophy and innovative supply chain management This "fast fashion" approach has transformed Zara from a mere fashion retailer into a prominent case study in contemporary business practices.