ZARA

ZARA is a vertically Integrated Retailer in apparel industry, linking customer demand to manufacturing, and link manufacturing to distribution and to retailing business. Their goal is to respond quickly to market demands which are always changing. Their ma or business strategies include!" #peed $ %uickly respond to the demands of target customers &young, fashion"conscious city dwellers'. They use (IT manufacturing philosophy to meet fast changing fashion market demand and trends. This strategy is to time fashion trends and strike while a trend is hot, and not be stuck with inventory when it dies off. )ecentrali*ed )ecision +aking $ ,entrali*ed at -a ,oruna by a group of commercials made up of store product managers, but decentrali*ed within functional groups. Those centrally located store product managers served as the main interface between centrally located design teams and Zara stores around the world. They could initiate store"to"store transfers when garments selling slowly in one area were popular in another. .ach design team of /commercials0 consisted of two designers and two product managers, dedicated to a section of the store &+en, 1omen, or ,hildren'. Those teams purchased material, placed production orders with the factories, and set prices for retail stores. Zara relied on those teams to decide on the fashion trends. 2ther employees within the commercial function also e3ercised a great deal of autonomy. They decided which clothes each store would be able to order. 1hen total orders from stores e3ceeded availability for an item in any period, commercials decided which stores would get clothes and which would not. 4o Advertising +arketing #trategy $ -ow marketing e3penditures of 5.67 on average. Zara spent relatively heavily on its stores to drive business. These retail stores were always located in a city8s prime retail district, often on the best"known street. #tore layouts were completely changed every four to five years, with artwork, window displays, and sales racks changed more frequently. All new store layouts were designed and tested in -a ,oruna, before being rolled out around the world. 9ashion )esign #trategy $ -ow cost, fast turnaround of trends. They are responsive to instant changes. They produce high fashion product in limited production runs with short life span. :roduct managers were encouraged frequent repeat visits to store to see what8s new.

IT +anagement #trategy $ They have no traditional IT department. They utili*e technology that is simple, cost"effective and easy to use for the company and does not require a lot of IT support. This strategy had supported Zara operations up to this point, but as the technology became obsolete, and new technology changes adopted by the competitors, the issue was to make their IT stay in line with the strategies detailed above. Zara should consider upgrading its )2# based :oint"of"#ale &:2#' system to Intuit";: Retail #olution, the industry"proven software. This solution is more sophisticated than a cash register and more durable than a :,. In addition to being a cash register, the Intuit";: Retail #olution could provide Zara a robust solution to also track customers, manage inventory, and get business insights. These are the missing capabilities of the current )2# :2# that put Zara at a disadvantage compared to its competitors. Its store managers are increasingly requesting the ability to look up inventory balances in their stores and other stores. Zara should consider implementing #A:. #A: is currently the leader in financial application and very compatible with most commonly used applications in industry. #A: can run on 1indows or <4I= and can be applied to their :2# terminals. #A: application has reliable tech support and installation team available at the time of purchase. #A: is a complete industrial suite providing the capability to manage financial, asset, cost accounting, production operations and materials, ;R, plant and records management.