Case Study Zara

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Executive Summary Operations management is in regard to management about monitoring, designing and managing all process of operations in companies. Every company has its own operation strategies, so it is crucial to get more profit through reducing cost and time in operation process. Zara, as one of largest apparel retailer over the world, has changed the process of the whole fabric of the industry. Operation strategy of Zara involves having little stock, fast updating collections and communication within process of operation etc. Zara renew its products twice a week to pursue latest fashion, on the other hand other competitors only update once a season, This report is going to analyze attacking and defending through Zara’s operation, in…show more content…
Although competitors have cheaper for the average cost in Asia, Zara has more competitive operation advantages than rivals. Nevertheless, other competitors have less cost on labor; they are lack of flexibility in changing and checking orders within operational process. Zara has lower inventory, so it need less warehouse charge and can invest more money on innovation and shop decoration. On the other hand, competitors have taken more inventory cost as orders are stocked for almost a season in advance until scheduled shipment to stores and distribution facilities. Lower inventory cost is one of key aspects to get Zara to keep its products at cheaper…show more content…
Comparing with other competitors such as H&M which only updates new designs once a season, Zara restocks twice a week to pursue latest fashion. Instead of spending average 3.5% of revenue on advertisement, Zara spends only about 0.3%. Zara spends more in technology operation, store decoration, innovation and keep products cheaper. Zara relies on its stores to build its image and has specialists whose main work is to keep changing the layout of the store every week. As a result, fashionable and changeable stores of Zare encourage shoppers to come back again and also mean that customers need buy their preferable products fast before sold out because of low

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