1.

What advantage does Zara gain against the competition by having a very responsive
supply chain?
ANSWER:
The advantage Zara gains is that it gets to introduce new designs every and can easily change the
display after 3-4 weeks. Also they have reduced inventory overhead and factory forecast errors.
They are selling most of their products at their full price and they are allowing multiple
shipments in a week.
2. Why has Inditex chosen to have both in-house manufacturing and outsourced
manufacturing?
ANSWER:
Outsourced manufacturing is for the predicatable demand of products and in house
manufacturing is for the demand which is not predicted it is rather ordered. These both provide
Zara a strong market as they are able to cope up with market easily. This provides good profit as
well.
3. Why has Inditex maintained manufacturing capacity in Europe even though
manufacturing in Asia is much cheaper?
ANSWER:
They have Maintained a large fraction of manufacturing capacity in Portugal and Spain (Europe),
despite the higher cost there, it allows Zara to respond quickly to changing fashion trends in
Europe, speed and responsiveness are more important than cost. Manufacturing Capacity in
Europe helps manufacturers offer fast and flexible sourcing and such products are to be delivered
quickly instead of at Asia
4. Why does Zara source products with uncertain demand from local manufacturers and
products with predictable demand from Asian manufacturers?
ANSWER:
Zara provides an uncertain demand with products and local manufacturers provide zara a good
fast pace process of manufacturing. Also manufacturing in bulk helps with less cost and good
strategy of making it cost effective for company. they can easily manufacture in-house by
responding quickly to trends and delivering in less than 2 days on a global scale.
5. What advantage does Zara gain from replenishing its stores multiple times a week
compared with a less frequent schedule?
ANSWER:
Frequent replenishment allows Zara to match supply and demand more effectively than the
competitors. This allows Zara to respond quickly to changing fashion trends in Europe
6. Do you think Zara’s responsive replenishment infrastructure is better suited for online
sales or retail sales?
ANSWER:
Zara’s 24 hour delivery times from Spain to outlets all around the world may not be as efficient
with online sales as it is with retail sales. Companies such as Amazon are able to respond
quicker to online sales due to the fact that they have distribution centers all around the world and
can offer same day delivery.