Vertical integration is the expansion within a company to grow its business areas at different points along the same production and sales path. Vertical integration can help companies reduce their costs while improving efficiency and flexibility. Zara, founded in 1975 by Amancia Ortega, is the world’s largest fast fashion flagship chain retailer owned by Inditex Group and is vertically integrated in all aspects of its business. Zara, according to Ferdows et al (2002), has a decentralized communication
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Marketing Channels: Zara | One global retailer is expanding at a dizzying pace. It's on track for what appears to be world domination of its industry. Having built its own state-of-the art distribution network, the company is leaving the competition in the dust in terms of sales and profits, not to mention speed of inventory management and turnover. Wal-Mart you might think? Dell possibly? Although these two retail giants definitely fit the description, we're talking here about Zara, the flagship specialty
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ZARA IT FASHION Zara follows a very simple business idea of linking Customer Demand-Manufacturing-Distribution, making them the best vertical integrated company with super responsive network. It just outsources simple activities, which doesn’t affect their corporate strategy or supply chain and gives a strategic advantage. Zara owns its upstream suppliers and downstream buyers, which has a significant impact on SBU’s (Sequential Business Units). It supports vertical integration, which aligns with
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Vertical Integration vs Outsourcing of Zara Written by Mohd Rahman October 04, 2014 “The original business idea was very simple. Link customer demand to manufacturing, and link manufacturing to distribution. That is the idea we still live by” -- Jose Maria Castellano Rios, Inditex CEO. 1 Introduction to Zara Zara is an icon in the fashion world and largest international fashion designing and manufacturing company. Zara is the flagship chain store of Inditex Group owned by Spanish
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1.0 Introduction: Zara is the flagship chain store of Inditex group which is owned by Spanish tycoon Amancio Ortega. It’s a Spanish based company essentially known for its clothing and accessories which was founded in 1975 (Mo, 2015). Zara believes in following the fast fashion policy, unlike its competitors. The discipline in Zara’s supply chain management has played vital role in its success (Anonymous, 2005). Zara follows vertical integrated strategy where it has total control
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Títol: Benetton and Zara information systems:a comparative analysis Volum:I de I Alumne: Chiara Pirone Director/Ponent:Jose M.Cabré Garcia Departament:Organización de Empresas Data: 28 Junio 2010 DADES DEL PROJECTE Títol del Projecte:Benetton and Zara information systems:a comparative analysis Nom de l'estudiant:Chiara Pirone Titulació:Ingenieria superior Informatica Crèdits: 37.5 Director/Ponent:Jose M.Cabré Garcia Departament:Organización de Empresas MEMBRES DEL TRIBUNAL President:Ferran
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approximately 80% of Zara stores were slated to be opened outside of spain 2. Compare Zara and H&M, What do you see? - Zara owned much of its production and most of its stores, H&M’s vertical scope was narrower - H&M had longer lead times than Zara (still considered average by industry standard) - H&M had been quicker to internationalize - H&M had been more focused in internationalization (one country at a time and a distribution center at each one) - H&M had lower prices than Zara, employed fewer
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3. Which type of vertical marketing system does Zara employ? List all the benefits that Zara receives by having adopted this system. Zara employs a Corporate Vertical Marketing System. Zara has managed to build a system that is controlled from a single place and that it allows it for quick response, decision and problem solving. Because Zara’s parent company Inditex owns most of the resources needed for the process of clothing design, production and distribution it is able to “control most
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double that of Inditex, Inditex is much more profitable. 2. How specifically do the distinctive features of Zara business model affect its operating economics? Specifically, compare Zara with an average retailer with similar posted prices. Zara sources fabric, other inputs, and finished products from external suppliers. It has purchasing offices in Barcelona and Hong Kong. This gives Zara a competitive advantage towards the costs of goods sold, as it can purchase from both Europe and Asia according
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http://www.papercamp.com/essay/39587/Zara-Recommendations http://jacennedyconsulting.wordpress.com/2012/03/04/social-media-integration-risks-and-challenges-zara/ http://europe.chinadaily.com.cn/business/2011-04/20/content_12360712.htm Some of its risks and challenges lies in its strategy, principles and company structure. Zara is a vertically integrated retailer. Unlike similar apparel retailers, Zara controls most of the steps on the supply chain, designing, manufacturing, and distributing its
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