ZARA

ZARA

1. Zara implemented “Quick Response”, helping retailers to reduce errors in forecasting and inventory management by planning assortments closer to the selling season probing the market. Zara would typically take no more than 6 weeks to deliver a product into stores starting with the design phase, in contrast with a period of 6 months for its competitors. Zara had used “Just In Time” very effectively.

2. Zara had a standardized product strategy and they positioned these products differently in each individual market. They utilized multiple markets to make adjustments in product mixes to obtain maximum profitability.
When entering a new country, they opened a flagship store in a major city, and gathered marketing insights into local demand patterns. These analyses would be used for countrywide expansion.

3. Zara created artificial scarcity in the multiple markets it operated in. They did this using rapid product turnover, furnishing their stores with new designs twice a week. Designs would typically phase out within a 3-4 weeks signaling customers purchase as they see, before the design is no more available.
Moreover, fabric purchased was un-dyed to provide flexibility for in-season updating of fashion.

4. They continuously tracked customer preferences. They would employ young staff with 78% women who would provide their insights to designers on a regular basis. These were incorporated in the continually evolving designs.

5. Zara used consumption information system that supported detailed analyses of PLC and tracking customer preferences. Apart from this, worldwide sales data was captured by Zara’s IT systems.