FAQs
Answer and Explanation:
What advantage does Zara gain against its competitors by having a responsive supply chain? ›
ZARA What advantage does zara gain against its competitors by having a responsive supply chain? It allows zara to match demand for fickle trends more accurately. This in turn means that they can sell products at full price and thus secure their margins and make a profit.
Does Zara outsource manufacturing? ›
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.
Why has Inditex maintained manufacturing capacity in Europe? ›
Why has Inditex maintained manufacturing capacity in Europe even though manufacturing in Asia is much cheaper? Inditex chose to have both in-house manufacturing and outsourced manufacturing because In-house manufacturing allows Zara to be able to respond quickly to the changing trend.
What is the source of competitive advantage for Zara? ›
ZARA has forged its position and reputation through an effective strategy of competitive advantage in quality and price. It quickly adapts to changing trends and offers good quality products modeled after the most popular fashion houses at an affordable price for everyone.
Which is a key capability that Zara has used to develop supply chain competitive advantage? ›
Resource-Based View (RBV) : Zara's resources, such as its vertically integrated supply chain and data-driven decision-making, are sources of competitive advantage. Unique capabilities, such as in-house design and production, contribute to its distinctiveness.
Why does Zara source products with uncertain demand from local manufacturers? ›
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.
Where does Zara source their products? ›
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.
Why is Zara's supply chain strategy successful? ›
Zara's supply chain effectively mitigates the bullwhip effect, a common problem where small disturbances lead to significant order fluctuations. Zara grants retailers a high degree of flexibility, allowing them to adjust 40% to 50% of their orders, compared to the industry average of 20%.
Why Zara expand internationally? ›
The limited market growth opportunities at home was the main influence on Zara's decision to expand internationally as recalled by Jose Maria Castellano, former CEO of Inditex: “Of course before opening the first store in the host market, we had the feeling and then we knew for certain that the Spanish fashion and ...
Inditex, the biggest fast fashion group in the world, operates over 7,200 stores in 93 markets worldwide. The company's flagship brand is Zara, but it also owns a number of other brands including Zara Home, Bershka, Massimo Dutti, Oysho, Pull&Bear, Stradivarius, Uterqüe and Lefties.
What are the aspects of the Inditex business model that have proved crucial to its success? ›
Over time, we have developed a unique business model characterised by flexibility, integration, sustainability, creativity and innovation.
What are the advantages of Zara supply chain? ›
Zara's supply chain strategy gives them greater control over its production process, allowing for faster speed to market that brings items from design to stores in as little as four weeks.
Which strategy has Zara used in its supply chain? ›
It uses a vertical integration strategy to manage scarcity and production of its fashion items.
How is Zara differentiating itself from its competitors through its supply chain? ›
Zara's agile supply chain enables rapid global garment delivery, with shipping times as short as 24-72 hours. Despite higher shipping costs, Zara's minimal spending on advertising and discounting balances expenses. Real-time store operations allow Zara to adapt swiftly to evolving customer preferences.
What does Zara hold a competitive advantage over its rivals in spite of? ›
Explanation: Zara holds a competitive advantage over its rivals despite operating through fewer stores across the world than its closest competitors. This is because Zara has a globally distributed contract manufacturing model.
