Inditex sourcing: where does Zara owner make its clothes? (2024)

FAQs

What is Zara's current sourcing strategy? ›

Zara‟s method of sourcing product is very different from the traditional methods used in the fashion industry because the company controls every part of the supply chain. Instead of using an outsider to design the clothes, the firm uses 300 in-house designers and relies heavily on store managers‟ input.

Like many other clothing retailers, Inditex outsources a large quantity of its production to suppliers in countries like China, Turkey, and Bangladesh. As of 2021, China had the highest number of suppliers that manufactured clothing and garments for Inditex.

Zara is one of the biggest international fashion companies, and it belongs to Inditex, one of the world's largest distribution groups. The customer is at the heart of our unique business model, which includes design, production, distribution, and sales, through our extensive retail network.

Our strategy for supply chain sustainability aims to create sustainable production environments in which the Human and Labour Rights of the workers of our suppliers are promoted and respected.

Mainly because the company want to be able to change the color to fit to the last trend and need of the customers. The company purchase the raw material to suppliers from Greece, Spain, Italy and Portugal. Those suppliers have to deliver the goods to “the cube “within 5 days mostly by truck, planes and train.

Answer and Explanation: Zara obtains products with an uncertain demand from domestic manufacturers because they can quickly respond to the needs of each shop in the local marketplace.

Inditex owns factories in Spain and outsources production to factories in Portugal, Morocco and Turkey — considered costly labor markets, typically. The rest of its clothes are produced in China, Bangladesh, Vietnam and Brazil, among other countries.

The group has twelve clusters in Spain, Portugal, Morocco, Turkey, India, Bangladesh, Cambodia, China, Pakistan, Vietnam, Argentina and Brazil, which concentrate 92% of its production.

Centralized order fulfillment

Zara sticks to a deep, predictable and fast rhythm, based around rapid deliveries to stores. Each Zara outlet sends in two orders per week on specific days. Trucks leave at specific times and shipments arrive in stores at specific times.

Zara makes about half their goods in Spain, in factories they own themselves. The rest of Zara's goods are made in cheap, long-lead factories in China and other Asian countries.

Does Zara manufacture in Egypt? ›

Welcome to Fashion Revolution Egypt!

There are brands like GAP and ZARA that produce their garments here.

The three levels of supply chain management are strategic, tactical and operational.

In 2021, our supply chain encompassed 1,790 direct suppliers in 44 markets who in turn used 8,756 factories, providing work for over three million workers.

The brand itself is engaged in the processes of design, storage, distribution, and logistics. Zara does not seek to maximize production volumes and uses the strategy of constant replenishment.

Most of Zara's clothes are manufactured at its sites in Spain or in nearby Portugal, Morocco and Turkey.

They ship very small batches twice a week. As a result, it creates a sense of scarcity, very few items are unsold, and if the experiment fails there is much time (thanks to their very responsive Supply Chain) to try other different styles. This eventually helps Zara find the right product almost every time.

Zara only uses a very small proportion of organic materials such as organic cotton, hemp, and linen, or recycled materials such as recycled cotton, recycled polyester, and regenerated nylon. Only very few of its collections are dedicated to sustainable fashion.

However, the brand has recently faced three main challenges: e-commerce, competition and sustainability.

“And its store managers are far from minimum-wage employees. They're experts in fashion and observation, and are taught how to pay attention to what customers are saying and doing to reflect what moves the brand needs to make next.” “Zara only spends about 0.3 per cent of sales on advertising.”

Does Zara outsource production and distribution? ›

Unlike other leading retailers located in North America and Europe, Zara's managers do not outsource their production completely.

Zara is owned by Inditex, the world's biggest fashion group. The company was not afraid to go against conventional wisdom, vertically integrate its supply chain, and move its production to Europe (near-shoring), while many players in the fashion industry chose to outsource production to lower-cost factories in Asia.

The value chain is characterised by what is known as proximity sourcing, which means that more than 50% of production is carried out in areas close to the head offices and logistical centres in Spain. The flexibility that defines Inditex has also spread to its suppliers that have flourished alongside the company.

The Zara factories are connected to the Cube by underground tunnels with high speed monorails (about 200 kilometers or 124 miles of rails) to move cut fabric to these factories for dyeing and assembly into clothing items. The monorail system then returns finished products to the Cube for shipment to stores.

Zara is a Spanish clothing retailer based in Galicia, Spain. Founded by Amancio Ortega in 1975, it is the flagship chain store of the Inditex group, the world's largest apparel retailer.

There are around 50 textile clusters in China. Guangdong, Shandong, Zhejiang, Fujian, and Jiangsu are the 5 provinces that account for 70% of the country's total textile production.

Inditex - Manufacturer from Goregaon East, Mumbai, India | About Us.

Zara's strategy is to offer a higher number of available products than its competitors. While most clothing retailers manufacture and offer to the public for sale 2,000 to 4,000 different articles of clothing, Zara's production has been markedly higher, at over 10,000 pieces produced per year.

Zara decides to produce more than half its fashion items locally and in its own facilities to achieve speed. At the time, most large fashion players rely on outsourcing production to Asia for cost reasons. This activity differentiation allows Zara to effectively react with lightning speed to fashion trends.

Another way Zara maintains its competitive advantage is by keeping most of their production in-house on order to cultivate a rapid supply chain. Often called the Dell of the fashion industry, Zara only buys undyed and uncut cloth in order to decrease or increase production based on demand.

What distribution strategy does Zara use? ›

Zara's strong distribution network enables the company to deliver goods to its European stores within 24 hours, and to its American and Asian outlets in less than 40 hours.

The Zara brand strategy

Its core values are found in four simple terms: beauty, clarity, functionality and sustainability. The secret to Zara's success has largely being driven by its ability to keep up with rapidly changing fashion trends and showcase it in its collections with very little delay.

Zara's success relies on keeping a significant amount of its production in-house and making sure that its own factories reserve 85 percent of their capacity for in-season adjustments. In-house production allows the organization to be flexible in the amount, frequency, and variety of new products to be launched.

I. Which element of Zara's strategy do you believe best explains its success? logistics, unlike other clothing brands, Zara can provide everything to their customers in under two weeks timeframe, ensuing in earlier return of income.

Most of its factories are built in Galicia, northern Spain (35% outsourcing). Aircraft transport is used once production is completed . As a result, design, manufacturing, logistics and distribution in the supply chain are all under its own control.

Every single piece of clothing passes through one of Zara's four distribution centers across Spain. We visited the largest of all, located in Zara's main headquarters in the small town of Arteixo, in the north of Spain. This area of the country is home to its founder, Amancio Ortega, and the first Zara store.

What are the Sources of Sustainable Competitive Advantage? The sustainable competitive advantage sources for any company include Brand Loyalty, Innovation, Proprietary Information Scale, Intellectual Property, Innovation, Network- effect.

“A brand is a promise of an experience and is directly connected to trust. It's what your customers say when you're not around,” said DiCostanzo. When done right, a brand can't be duplicated, and that is a competitive advantage.

Through its 'Just in time' or Lean business model, ZARA breaks the fashion supply chain rules by holding low stock and updating its collections continuously. Twice a week, at precise times, store managers order clothes, and twice a week, on schedule, new garments arrive.

While some competitors outsource all production to Asia, Zara manufactures its most fashionable items – half of all its merchandise – at a dozen company-owned factories in Spain (particularly in Galicia), Portugal (northern part) and Turkey.