Zara logistics

Fashion at low prices, manufactured and distributed quickly, and technology have been key ingredients to the
success of Zara; as it interprets the latest trends in less than 15 days and delivers the goods to the premises twice
a week. Trends specialists travel the world in search of new designs, and all the locals are electronically connected
to the parent company; which allows local managers ensure that designers have access to real-time information
when deciding together with the sales team about fabrics, cuts and prices of a new garment. Every year the
collection is renewed with 11,000 models. There is a team of 200 designers creating new designs. The products
are manufactured in small volumes and tested in certain premises before deciding to quantity production, which
contributes to a failure rate of 1%, very low rate compared to the typical 10% of the industry. Each assigned to a
local garment comes from the distribution center with its price tag. Then, local managers and industry reordered
the product according to its movement in the store (performance) and complete data on a "Palm" (handheld
Cassiopeia) that connects daily with the parent company; also add comments on questions from customers about
existing products or new products they are seeking. very low rate compared to the typical 10% of the industry.
Each assigned to a local garment comes from the distribution center with its price tag. Then, local managers and
industry reordered the product according to its movement in the store (performance) and complete data on a
"Palm" (handheld Cassiopeia) that connects daily with the parent company; also add comments on questions from
customers about existing products or new products they are seeking. very low rate compared to the typical 10%
of the industry. Each assigned to a local garment comes from the distribution center with its price tag. Then, local
managers and industry reordered the product according to its movement in the store (performance) and complete
data on a "Palm" (handheld Cassiopeia) that connects daily with the parent company; also add comments on
questions from customers about existing products or new products they are seeking. Local managers and industry
reordered the product according to its movement in the store (performance) and complete data on a "Palm"
(handheld Cassiopeia) that connects daily with the parent company; also add comments on questions from
customers about existing products or new products they are seeking. Local managers and industry reordered the
product according to its movement in the store (performance) and complete data on a "Palm" (handheld
Cassiopeia) that connects daily with the parent company; also add comments on questions from customers about
existing products or new products they are seeking.

Instead of "Outsource" manufacturing, Zara produces about half of its products in their shops. According to the
supply policy established by the company, the fabrics come from Spain, Italy, Turkey, India, China and East are cut
and dyed in a factory with the latest technology. Using the information collected through the handheld computers
on the premises, product managers decide how many and which produce garments that have local are. MFPs
administered a flexible process "just in time" in the seventeen Inditex factories. Inditex purchase fabrics 50%
undyed; Then in the distribution center parts that make up each garment is cut and sent to a network of 400 small
specialized workshops in Galicia and northern Portugal, for sewing or bonding. Arteixo garments again to be
ironed, labeled and quality control before being distributed worldwide; this only between 10 and 15 days after
being appointed. Workshops charge for finished garment and also receive technological, logistical and financial
support to improve their quality and delivery times. 80% of the clothing is manufactured in Europe, mainly in Spain
and Portugal, this allows the company to manufacture a new line in just three weeks, contrary to the industry
average is 9 months; while the products do not remain on the premises more than a month. this only between 10
and 15 days after being appointed. Workshops charge for finished garment and also receive technological,
logistical and financial support to improve their quality and delivery times. 80% of the clothing is manufactured in
Europe, mainly in Spain and Portugal, this allows the company to manufacture a new line in just three weeks,
contrary to the industry average is 9 months; while the products do not remain on the premises more than a
month. this only between 10 and 15 days after being appointed. Workshops charge for finished garment and also
receive technological, logistical and financial support to improve their quality and delivery times. 80% of the
clothing is manufactured in Europe, mainly in Spain and Portugal, this allows the company to manufacture a new
line in just three weeks, contrary to the industry average is 9 months; while the products do not remain on the
premises more than a month. contrary to the industry average is 9 months; while the products do not remain on
the premises more than a month. contrary to the industry average is 9 months; while the products do not remain
on the premises more than a month.

Some of the garments produced in factories next arrive at the distribution center of 500,000 square meters
through tunnels under the old street. At a rate of 60,000 per hour, garments must travel the 200 km of aerial rails
on their perches, to join the rest of the clothes that make the purchase order from a local, before being distributed
to European local or airport to reach premises across the ocean. At the lowest level, two carousels 400 meters
long, adapted from a Scandinavian manufacturer, fold the clothes and put into a box, at a rate of 40,000 pieces
per hour. So every week, 1.800 million garments leave the distribution center and local receive new designs twice
a week; while competitors take six weeks in the best case. In Europe the products are delivered by truck fleets,
while for the most distant local airway is used.

Lorena Alba, an industrial engineer, manages the logistics of the two weekly cycles of local supply; that is to ship
the products on Saturdays and Wednesdays and restock local Mondays and Fridays. Organizes and manages
distribution centers for different strings, coordinating commodity import department and factories in Spain. But
his concern is to stay level with an annual growth chain between 20% and 30%, optimizing the flow of information
to improve the quality of orders and while maintaining the flexibility of operation. Planning an advance of 5 to 10
years required to participate in strategic planning and meet the new requirements that come from the marketing
department.

Zara plans a central collection of products that covers almost 50% of its production. The remaining 10,000 items
consists of items that can be used at any location in two weeks. Other products have been added to complete the
line: footwear, handbags, lingerie, jewelry and beauty products. There are two lines of perfume complete the
offer: Zara Fragrances, an ambitious perfume and Textures Zara, which varies with each style of clothing. Clothing
for ladies is divided into three: Zara Women, for executive style or fashion; Zara Basic, younger and informal
Trafaluc, athletic and young. Clothing for men is also divided into Mens Line at Zara, Zara Basics, 100Zara (casual
attire) and Zara Sport.

The company pays advertising in major newspapers only twice a year to announce each of the half-yearly
settlements. Liquidations end of the season are drastic: everything is sold, leaving completely empty at the end of
each season premises.

ZARA has a model that is based on controlling the distribution channel in full manufacturing and distribution, using
logistic considered one of the most effective in the world. Control orders and deliveries, through the
implementation of just-in-time, is implemented in all units and departments. Control and speed of the process,
design-manufacturing-distribution is a key aspect of their success. Within 15 days in the domestic market and 20
days in the international market, the design department, assisted by information from all stores ZARA in the world,
create the model, with minimal production time , and efficient logistics, reaches retail outlets, with the added
difficulty of creating two collections summer-winter, depending on whether European or South American
destination,

ZARA is distinguished by a unique business model in the field of retailing fashion, in which vertically integrates all
major activities chain including design models value, production of garments, logistics input and output as well as
sales in company stores. Other processes such as manufacturing are outsourced to about 2000 workshops
(external and own) so that many costs are lowered. It is a strategy that from buying fabrics to the final sale to the
customer, within minimum production compared to its competitors is done in 15 days.

Just in time: A huge strength is thus not stored clothes and no money is lost inventories. If it is discovered that a
model not like, is removed and redesigns adapting to consumer tastes or moves to a market where if you've been
successful. It is a Just In Time system, produces only what will sell in the short term and thus no risk.