Decision Making Decision making at Zara is very much disintegrated. Operations like ordering, fulfillment and design and manufacturing at Zara are based on important decisions made at a lower level by customer facing employees. These decisions sometimes do not even need the reviews of the higher management. A group of commercials decided what existing and new garments to place an order for depending on the sales of a particular store. Another group of commercials determined future production for a SKU (stock-keeping-unit) depending on the balance of the demand of garments in the stores and supply of finished clothes coming from factories into the DC. Prediction of the changing tastes of the young, fashion conscious city dwellers was done by a group of commercials. These decisions helped in creating variety in the designs of new stock. These decisions also helped Zara introduce new design collections all throughout the year depending on the current customer demand. This speedy and autonomous decision making approach is working wonders for Zara and seems coherent with its goals. It helps Zara follow the JIT (just-in-time) technique. Since the commercials are groups of employees who are actually witnessing the trends in the demands and supplies of a Zara store, they are in a better position to make quick decisions. This helps Zara speed up the entire vertically integrated supply chain making the products available just in time for sale. A senior manager sitting far away won’t be able to judge the requirements of the store as well as an employee working in the store. I used to work for Singapore airlines as a flight attendant and a customer facing employee we had the freedom to respond to a passenger’s requests at our own discretio... ... middle of paper ... ...ate with each other when one store runs out of a particular garment but the other store has it in stock. 8) The stores will also be able to communicate better and maybe swap their inventory when a particular stock is doing better in on store and vice-versa. This will help reduce production costs as the store which has run out of its popular garment pieces will not request for more. Conclusion Zara has a great and unique operating strategy which helps them achieve competitive advantage. However, at the same time it lacks the IT support. It needs a good IT strategy that will support its supply chain and enhance their systems in order to support their operational strategy. A fast paced retail company like Zara needs to strengthen its IT system by getting rid of its aging systems. It needs to do this soon before any other company overtakes them in this race.
Usually, television sales choose a time when consumers are free to watch television to present fancy commodities like jewelry. The announcer talks about the features of the product over and over for a half an hour. It gives the consumers a feeling that something he/she needs that product ever if it was expensive, they can be offered. Different brands send direct mail catalogues with their websites or phone numbers for ordering, it gives consumers the opportunity to shop when and where they want, and how the brands are collecting votes for their commodities. What all the companies need to do is let consumers vote for their brand by hiring people who can innovate a now features for their commodities or produces.
The Target Corporation prides itself on their department store roots with a constant obligation to great prices and stylish originality. The main focus of every Target store is the customer, whom the corporation refers to as a "guest", making them feel more personal. Each guest can expect to walk into a clean, organized, and easy to navigate store with "high quality, stylishly designed items plus all the essentials for his or her life".1 The company also has a significant focus on design. The company employs a "design for all" strategy that says great design is for everyone to enjoy, everyday. The product designers know how to create products you will "love to live with and low prices you can't live without".1 The commitment to design has become a key technique of attracting and keeping their shoppers coming back.
Nordstrom uses drop shipping. Drop shipping reduces the cost and the risk of holding inventory. Retailers stock only popular colors of a certain item, but making a more broad arrangement of colors available due to drop shipping. Drop shipping will reduce the risk with unsold inventory if sales decline. Nordstrom allows retails and suppliers to track each other’s inventories. This will reduce the olds of a consumer buying a product only to find out that it is unavailable (Chao).
By putting the warehouses in strategic locations, you provide better access to those customers in more remote locations. By taking advantage of this, Under Armour will not only expose itself to new customers, but will be able to continue to dominate the athletic performance apparel industry.
The inventory issue also ties in with transportation problems where accurate lead and delivery times are non-existent. The inventory turnover is not at its full potential because if the DC has merchandise yet the stores are stocked out, the inventory is frozen and will become obsolete.
1) With which of the international competitors listed in the case is it most interesting to compare Inditex’s financial results? Why? What do comparisons indicate about Inditex’s relative operating economics? Its relative capital efficiency? Note that while the electronic version of Exhibit 6 automates some of the comparisons, you will probably want to dig further into them?
The principles of marketing (The Times 100, n.d) are a range of processes concerned with finding out what consumers want, and providing it for them. This involves the ‘4ps’ of marketing; price, place, product and promotion. The product decision in any company involves dealing with goods that should be offered to a group of customers (Jobber & Ellis-Chadwick, 2012). Burberry maintains a product line with great width and scope in which their products fall into two main categories; fashion or continuity. Their fashion products are designed to be responsive to fashion trends and are introduced on a collection to collection basis (Burberry, n.d). Continuity products however have life cycles that are expected to last for a certain time period. Burberry also has 3 primary collections; womenswear, menswear and accessories, with the variety of products they can utilize their product mix greatly. Burberry also has...
Further, let's say that the blue shirts sell out immediately; the store is left with inventory of the three other colors. Yet Kmart doesn't reorder the blue ones because 75 percent of its inventory is still unsold – it's still got plenty of that style of shirt to sell. Wal-Mart, meanwhile, would order a new shipment of blue shirts. Their model takes the customer into account, not the inventory – Wal-Mart understands that it's the color the customers want, not the style (in this case, anyway).
(Dizik, 2010) Corporate policies, and training on those policies can mitigate the risk of customer-related disturbances. JetBlue failed to arm Mrs. Amarsingh with the proper “know how” on dealing with unmannerly customers. JetBlue is aware that “passenger frustrations” are increasing and flight attendants continue to be “walking targets” for intense customers. (Kinicki & Fugate, 2012, p. 170) Since the company understands the current environment, it is JetBlue’s duty to protect Mrs. Amarsingh, and all employees, from belligerent customers. JetBlue employees should not expect to fend for themselves against hostile patrons, without support from the corporate leadership. (Bloom,
Problem Recognition is the first step in the consumer decision making purchase. When customer passes through this step, it moves to the second step which is known as information search. Zara focuses on this step. When customers starts collecting information to know about a particular brand or various alternatives available in the market. As per the customers of Zara, various factors can influence their decision to choose Zara. Some of the factors that can influence the decision of its customers are products, brand image and brand identity, coming up with new products every two to three weeks and ambience of Zara stores and outlets. The decision factors differs from a person to person are unique for every person. Zara has to focus on factors like brand image, brand identity, products, ambience of its stores, so that it can influence the consumer’s decision and attract more customers to choose Zara. (Vaxjo, K. 2011)
The fundamental business strategy of Zara is very simple which is linking customer demand to manufacturing, and liking manufacturing to distribution. Zara has been running their business in fashion industry which is susceptible to seasons and quick changing customer tastes. Zara has been approached to and considered their business as a perishable commodity business just like a fresh baked cake or bread to be consumed quickly.
The business model that sets Zara apart from other clothing retailers is how rapidly the company changes stocks and releases new product lineups. The company averages 12-16 collections annually which equates to more than one lineup a month. Due to stock being limited and the rapid production Zara brings forth, their items are viewed as exclusive promoting further business. Their customers are happy knowing that their specific article of clothing is more “rare” due to only having an average of a two-week window to purchase the clothing. The company specifically targets current trends and has them in the store within 30 days. This maintains the brand’s uniqueness and relativity in fashion.
This paper describes the various aspects of the Zappos case. The objective is to evaluate the depth analysis of the Zappos strategy. It enables to determine the Zappos strategy, business model & marketing strategy, and smartness of the Zappos acquisition.
The IT strategy for an ecommerce company is not similar to a utility company. For example, the IT strategy for amazon or ebay not similar to that of a power grid company in west coast. IT strategy and budgetary policy is different for Tiffany and United Airlines. Agile leaders constantly think about their IT strategy to ensure IT is in alignment with business strategy of the company. Agile leaders must ensure that knowledge gap is minimal within the organization. By eliminating the knowledge gap, an organization can operate more efficiently and help cut or avoid costs that does not add value to the business. In order to set effective and meaningful IT strategy, leaders should consider designing and architecting an IT organization where IT organizational function, IT architecture and agile development framework are converging well. Another component plays a significant role here which is outsourcing. Agile organization’s decentralized functions along with deeper understanding of applications, software and hardware architecture is advantageous before allocating budget for outsourcing for the agile software development. One way to control IT budget is to ensure IT decisions are business demand driven while demands are well vetted and controlled. Ensure which demands and ideas are quantifiable in terms of value, revenue, efficiency and quality. But at the same time, IT leaders must ensure that
When comparing two different ways of shopping most people do not even think about, they do both and not even realize it. In today?s society people shop while at work, after work and on the weekends, whenever time permits. Did you ever stop and think how can I get more time in the day for family or just myself? The best way to figure out with all the recourses we have; still most of us go into a store and spend time looking through racks and waiting in endless line to just purchase something. I compared going into a store verses online shopping; to see which on will save you time and money.