April 2 Zara Supply chain.pdfVIP

Zara’s Supply Chain Management Practices Case study Reference no 606-021-1 This case was written by P Indu, under the direction of Vivek Gupta, ICFAI Center for Management Research. It is intended to be used as the basis for class discussion rather than to illustrate either effective or ineffective handling of a management situation. The case was compiled from published sources. ? 2006, ICFAI Center for Management Research ICMR . No part of this publication may be copied, stored, transmitted, reproduced or distributed in any form or medium whatsoever without the permission of the copyright owner. Distributed by ecch, UK and USA North America Rest of the world t +1 781 239 5884 t +44 0 1234 750903 ecch the case for learning All rights reserved f +1 781 239 5885 f +44 0 1234 751125 Printed in UK and USA e ecchusa@ e ecch@ 606-021-1 ZARA’S SUPPLY CHAIN MANAGEMENT PRACTICES “Zara has managed to fill a hole and seize an opportunity in Spain. It has done for fashion what IKEA did for furniture, filling the gap between hypermarket and designer clothing in a very desirable way.”1 - Valerie Van den Boffche, Head Wolff Olins, Spain, in 2004. “Zara is nimbler and faster to the market. This will be important as fashion trends globalize.”2 - Keith Wills, European Retail Analyst, Goldman Sachs3, in 2000. ZARA’S FAST FASHION STRATEGY In 2004, a famous pop star toured Spain to give a series of concerts. Her outfits attracted instant attention from teenagers and young girls across Spain. By the time the pop star had reached the last leg of her tour, Spanish girls were sporting outfits similar to the ones she had worn during her first concert. The outfits were designed and distributed by apparel retailer Zara, which quickly gauged the demand for them and stocked up its stores across Spain in less than two weeks. According to a survey conducted by Interbrand4, Zara was the only Spanish brand to be featured in the list of ‘T