Supply chain management at zara fast fachion

Supply chain management at zara fast fachion Zara, a clothing manufacturer in Spain was launched in 1975 as a local store. Today, it is the third largest manufacturing company in the world (Chemawat Nueno, 2006). The company, Inditex, has over twenty manufacturing plants in Spain and more than 1,000 stores in over 30 countries in the world. The highly applauded manufacturing strategy was envisaged by owner Amancio Ortega Gaona. He demonstrated that lean inventories and flexibility may be even more crucial than cheap labor, a notion that just revolutionizes the exodus of manufacturing jobs from the west. His insight was successful because the company is now a case study at business teaching institutions from Wharton to Harvard and the IESE in Spain. This paper is going to discuss how Zara uses technology to improve operational responsiveness to customer expectations, and at the same time to cut down costs in certain areas and also the factors Zara bases on determining the price of her products. à ¢Ã¢â€š ¬Ã‚ ¢ Use of technology Identification of fashion trend at Zara is part of the culture. A point-of sale (POS) system is used in the stores and the information gathered is sent to Inditex. Also, the POS technology has allowed to tight up the links between vendors and led to improvements in the ordering process, in deliveries and in the distribution system as a whole, thus contributing to increase the level of responsiveness of ZARA. Moreover, managers consult personal digital assistant on daily basis to check the availability of new designs and to place their orders to what they think will be much appreciated by their customers. By so doing, the store managers assist shape designs (Innovels, 2008). Information and communication protocols at Zara are radically different from its competitors. The company spends less than 0.5 percent of total revenue on information technology and employees in the IT department account for only 0.5 percent of the companys total workforce (Chemawat Nueno, 2006). This differs from their competitors who spend about 2 percent of their total revenue on information technology and have 2.5 percent of their total workforce dedicated to IT (Ferdows, 2004). Zara makes use of human intelligence and information technology such as their PDA devices to come up with a hybrid model for flow of information from stores to the headquarters. For instance, the companys managers utilizes handheld devices to send formalized information concerning feedback from customers and ordering needs straight to in-house designers. Apart from keeping Zaras designers informed on fast-changing demand and trends, this technique also provides the company with imminent on less-desirable products. Unlike Zaras hybrid model (which combines IT application and human intelligence), competitors rely mostly on information technology. The hybrid model results into well managed inventories, reduced costs from obsolete products, linkages between supply and demand, nevertheless, there is still room for upgrading in their IT processes to realize more reliable management of inventory levels. Therefore, this unique approach of human astuteness assisted IT solution provides cost advantages to the companys operations and assists Zara to abide by her primary principle to be in a position to quickly respond to changes in consumer demand (Chemawat Nueno, 2006). The SKU system allows the gathering of data to help identifying and producing garments sought by customers, and in the right quantities, thus improving the ordering system at the distribution center. ZARA, then, successfully maintain control of its inventory while keeping inventory costs at a lower level. Zara also made considerable investments to improve its logistics system and to develop its IT infrastructures. ZARA chose to implement a Just-In-Time (JIT) manufacturing system as well as to invest in a sophisticated telecommunication system, thus improving the information flow between headquarters and supply, production and sales sites and thus avoiding any type of bureaucratic structure. Furthermore, this system allows ZARA to take appropriate and quicker decisions due thanks to the information flow being very fluent. The JIT system allows ZARA to improve quality, to diminish manufacturing time, to eliminate waste, to increase productivity and to have better relationships between suppliers, thus improving its overall responsiveness. The use of a consumption information system linking together the merchandising and the back-end processes is an original technique used by ZARA that permits designing teams to possess relevant information about customers preferences. This technology contributes without doubt to ameliorate the responsiveness of ZARA: indeed, the data gathered by this system allow teams to propose new designs that match consumers expectations, and in a timely manner. A high-tech mobile tracking system speeds up the distribution system by proceeding high numbers of garments in a short period of time, thus minimizing intervention of labor force while increasing productivity. As garments did not stay for a long time in the warehouse, the company is able to cut down storage costs. Zaras capabilities, concepts and strategic planning as demonstrated through their business model, tend to be heading in the right direction (Chemawat Nueno, 2006). Their concentration on core operation as well as production capabilities, resistance to outsourcing, and focus on the fashion pulse have made this company one of the most victorious clothing retails. Technology is present in all four crucial steps that makes ZARAs responsiveness so fast. (Illustration taken from Devangshu, D., 2002) à ¢Ã¢â€š ¬Ã‚ ¢ From what you see in the case, does ZARA price on the marked or based on other factors? Zara utilizes market-based pricing. In this method, the process is arrived at by bargaining among many sellers and many buyers in a competitive market. For market-based pricing, the fundamental question is: how can a product be valued by the market? The answer to this question is contextual and conceptually based; that is, it depends on a particular product category and a set product of reference. In some product categories such as clothing, Zara expresses value as monetized costs and benefits, and in purely economic terms. The fundamental concept is economic value to the customer. In real sense, rational customers add up the expected benefits, relate them to the coupled costs, and buy the companys products if it provides enough benefits to justify the price, and the most complimentary relative to other spending alternatives. Managers at Zara try as much as possible to monetize all the costs and benefits and with economically rational customers, this pricing analysis is fundamentally straightforward. That is, the customers make decisions basing on a multitude of factors that are crucial to them. Their decision may be a combination of both non-economic and economic factors that can be subjective or objective (Ferdows, 2004). In this more obvious case, during the starting point for deciding a price Zaras managers first calibrate the implied importance of the acquired benefits and relate them with the price of the product in a competitive market (Chemawat Nueno, 2006). They use an analytical technique called value mapping for framing the price benefits relationship. Nevertheless, if a decision was taken to enter a specific market, buyers effectively turn off the extra expenses of supplying it from Spain. Prices were moderate, 40 percent higher in many other European countries than in Spain, 70 percent higher in the Americas, and in Japan the prices were 100 percent higher (Chemawat Nueno, 2006). Zara had analytically marked local currency prices for all nations in which it has branches, on each clothings price tag, calling the latter atlas with the expansion of its footprint. As major markets in Western Europe started using the euro at the beginning of 2002, the company simplified its price tags to list only the price in the local markets in which a specific clothing can be sold, even though logistics were complicated by this (Chemawat Nueno, 2006). Zara made use of joint ventures in bigger and more crucial markets where there were hindrances to direct entry, in many cases those related to the difficulty of getting enough retail space within the cities. At the beginning of 2002, many Zara stores abroad were managed through joint ventures. Interests in all joint venture were equally shared between Zara and their partners. With much lower prices in Spain and the information available to the public, a large percentage of Spain citizens afford Zara products. In a country such as Mexico, there is a narrower targeted customer base. This is due to informational and cultural reasons. Only the middle and upper class in Mexico can afford Zara. à ¢Ã¢â€š ¬Ã‚ ¢ For an apparel retailer what are the advantages and disadvantages of online distribution? Can Zara make it work? Responding to increased competition in the industry, to changing customers preferences and habits, as well as to a decline in High Street spending (BBC NEWS Business, 2010), it was crucial for ZARA to offer an online, e-retail distribution service. In an article published by the BBC NEWS Business (2010), Julia Caesar wrote that consumer confidence is waning and many fear a further economic slowdown. Online fashion sales, meanwhile, are proving resilient. Online shopping has experienced a dramatic growth, as more and more people are being equipped with Internet connections. It has been widely acknowledged that contrary to traditional retail stores, online retailers benefit from more regular and stable revenues even in period of crisis. According to Forrester consulting group, shopping on the net is expected to see sales grow to  £94bn ($144 bn) in Western Europe by 2014, from  £56bn in 2009. Therefore the Internet presents great opportunities for the future. An online store is also a good way to complement existing traditional stores, because customers generally have access to a greater choice of products rather than when going to their local store. Thus, it can be perceived as being more convenient. An online retail store w ill offer the opportunity for people who do not have time such as business people to obtain the product they want before the next ZARA collection is brought to the market. Indeed, with ZARAs rapid product turnover, introducing new collections twice a week, these people may not have time to get the product they want before the collection ends. An online retail store allows remedying to this problem. Moreover, an online retail store gives opportunity for ZARA to reach new markets without physically opening stores in these markets, thus saving real estate costs. It can also be used as an online market entry strategy to expand worldwide or to test the possibilities of doing commerce in a particular country. Moreover, E-retail distribution may satisfy customers who did not have positive customer service experience when shopping in-store and it may help reaching new customers who do not have easy access to physical stores. To finish, e-retail will give the opportunity to ZARA for gatherin g more information about customers and to develop personalized marketing tools, such as online relationship marketing, using diversified channels. Conversely, online retailing involves several disadvantages. The most apparent disadvantage, particularly in the apparel/fashion industry, is that customers cannot try the product and in case if the product does not fit, customers would have to send the product back to ZARA and make a new order or wait to get reimbursed. Even if this process can be shortened, this still takes time. A reporter from Fox Business News (2010) analyzed that one of the snags of Inditexs fast-fashion business model could be the difficulty of reselling the typically large number of goods returned by online buyers because those goods could already be out of date, thus adding another disadvantage to the choice of retailing online. There might be a dilemma concerning returns for Inditex: the e-retailing accounts for an important amount of them. Also, this would hardly match with their fast fashion selling strategy which involves getting rid of the stock and selling the products very rapidly. ZARA may face a problem if stocks re-emerge weeks later thus affecting the sales flow of the company. Another problematic is that ZARA may fail to attract different customers than youth in their 18-34, eager to proceed to online shopping contrary to older populations. Even so the launch of a website makes it virtually possible for anybody in the world to access it; ZARA would have to do extra efforts to attract both its existing customers who are presently shopping at physical stores, but also to attract new customers. This is not an easy task considering the vast choice of competitors who are only a click away from ZARA on the Internet and who have entered the Web much earlier. An interactive, attractive website, easy to use, would be the correct manner to adopt. There are more general drawbacks linked to online retailing. Depending on the number of virtual shoppers, the website may be slow to load, thus frustrating customers. An e-retail store involves maintenance costs and may require hiring technical staff such as computer engineers. Because of the required maintenance, sections of the website or the website as a whole may not be available at certain moments. Privacy as well as security and protection of data may prevent customers from buying online. Indeed, Hoffman et al. (1999) have emphasized that 95% of Internet users have, at one time or another, refused to give personal information. To make it work, Inditex would need to accompany the launch of the ZARA website with appropriate marketing campaign in order to ensure that customers are aware of such initiative. ZARA would also need to optimize its image on the Net, by investing in search engine optimization systems for example. ZARA would have to make sure that its customer service team is capable of providing adequate support to e-customers such as providing them with technical help. Another challenge for ZARA will be the integration of its e-business and online operations within its current supply chain. This might require reorganizing part of the supply chain by modifying existing machinery (to properly route online orders) or investing in new equipment in order to integrate this new e-shopping process. To finish, despite the fact that ZARA has invested in effective, high-tech IT systems, it seems that the company lacks of skills and experience in the field of the Internet, social networks and new technologies such as Smartphones, even so the company is present on all these media. By now, ZARAs visibility and popularity on the Web testify from its success. However, ZARA, after having launched its website in September 2010, has been criticized because it was not compatible with all web browsers; also ZARA recently launched an application for Iphone that has been perceived as pretty disappointing by users, as price of products was not displayed, no contact information was provided, a store locator was absent, thus making the application rather obsolete. Therefore, as a key actor of the apparel industry, but also because of increased competition and of the opportunities it offers, ZARA had no choice but to be present on the Internet. However, ZARA might need consulting advice in order to sustain and develop its presence on the online platform and to develop new innovative tools, as well as to create a buzz in social networks and online communities that are booming nowadays. Iphone application from ZARA Conclusion The best way for Zara to increase their sustainable growth is to look for new opportunities in the apparel market. With ever changing consumer trends that are due to globalization, there are growth chances for companies such as Zara to increase their growth. Even though they use both information technology and human intelligence they still need to invest much in technology. Their pricing strategy which is market based seems to be successful as it bases on consumer satisfaction, and is ever dynamic and changes with change in consumer behaviour.

Impact of the Telephone Essay

If you didn’t have the telephone then how would you contact people? You wouldn’t be able to easily. If you wanted to talk to people you would have to go to their house, meet them somewhere, or write to them. That would be difficult. The world’s communication has been upgraded by the telephone. The telephone had a large impact, it made business more efficient and it saved money from having to travel back and forth from far places, and it made transactions able to occur more quickly. It led to instant communications around the world and even led to the Internet. The telephone also opened up many new job opportunities by starting new companies and building and making more telephones for the rest of the country and world. (www.learnnc.org) Before the invention of telephones, mail was a large part of life. This was mainly because it was the only way of communication. Telephones are a huge part of today’s life. As telephones became more and more advanced they also became more and more popular. Now it is the most common way of communication. (www.slideshare.net) Our modern day telephone system has made our communication system more unified. Telephone has bridged the gap of long distance communication. This expansion of the telephone can never be stopped long as the telephone business continues to build for the future. No single year in the fifty of telephone history has recorded a shrinkage in telephone use. Telephones in the United States have multiplied from Bell’s one telephone t to more than 17,000,000, or one to every seven persons in the United States and the average number of telephone conversations daily has risen from less than 8,000,000 in 1900 to 70,000,000 in 1926. (www.learnnc.org) There is no overacting, the public demand for telephone service increases with every extension and improvement of that service. Apparently, the telephone industry is destined to grow as long as the United States grows. Certainly it will continue to grow as long as individuals and groups through improved communications find it possible to increase production and sales, leisure and wages, profits and the pleasantries of life. Before the invention of the telephone, messages were sent mainly via messenger and mail. Due to the great distances being travelled to deliver  messages, only important messages were being sent. Alot of the jobs that are existent today were non-existent during the phone-less decades. For example, the telecommunications industry and the eCommerce industry were not in existence during these times. If a person needed information about goods or services being offered in the community they would ask a friend or relative, or they would get on their horses and wagons and travel down to the local business and inquire for themselves. Before the invention of the telephone, people would rarely immigrate to other places for the fear of not being able to communicate with their family and friends. Communities had more of a social setting than they do now. Strangers would communicate with each other and friends would gather to discuss the latest gossip and enjoy each others company. In current technological times, we are no longer interested in socialising with the people around us, not even our neighbors. People were more aware of their surroundings and they appreciated it more than the modern day technological society that we live in. Traditions were held up and culture expanded. How do smart phones affect in our daily lives?Research has found that smart phones satisfy all social communication needs. this lead to addiction, lack of concentration and even lack of sleep. Smart phones have a huge negative effect in the workplace, because workers can not meet their deadline. The aim of this research was to find out if it is worthy getting a smartphone? and how is it going to benefit the person buying it? Smart Phones are highly advanced and are good in multitasking, but they changing our lives in a negative way. people do not communicate as much orally and become antisocial. Students do not concentrate in class. People become addicted to the phone and dependable. These are the effects that smart phones have on us.In conclusion: as good as smart phones are the negative effects are out weighing the positives. It is hard to say whether the invention of the telephone was a good thing or a bad thing for our society. Some might argue both sides. When attacking this issue there are a lot of different facts a person has to look at before they can decide. Some of the advantages of this technology are: In the event of an emergency, the proper authority can be contacted, we can now  communicate with our family whenever we wish (this promotes strong family ties),and businesses can now spread their services throughout the world. Some disadvantages that the invention of this technology had brought about are: Loss of traditional culture, increased health problems due to radiation, lack of privacy, and increased disturbances and lack of awareness of our surroundings. Although, there is some good and some not so good effects to this invention, it is hard for me as a person of this generation to be able to imagine a picture of a world without telephones. We know that it is the most important technologi cal invention because of the length of time it has been utilized and the rate in which its use continues to grow throughout the world. I believe that it has created a more controlled environment and should continue to be utilized for years to come. Works Cited â€Å"1.5 The Impact of the Telephone.† The Impact of the Telephone. Web. 11 Mar. 2014. . â€Å"Smartphone’s and Their Effect in Society.† Smartphone’s and Their Effect in Society. Web. 12 Mar. 2014. . â€Å"The Telephone’s Impact on America – The Telephone; Impact on America!† The Telephone; Impact on America! Web. 13 Mar. 2014. . â€Å"Thoughts of An Aspiring Journalist.† Thoughts of An Aspiring Journalist. Web. 13 Mar. 2014. .

Essay about What Makes Sociology Different - 856 Words

Before commencing a discussion on analyzing the article â€Å"What makes sociology a different discipline† from the other sciences we should have the know-how about sociology. In the words of modern thinkers of sociology namely Karl Marx, Max Weber and Emile Durkheim â€Å"Social fact should be the subject matter for the study of social life and can provide explanations for human thinking and behavior (p19)†. What we infer from the above definition is that man is born as a social animal. Man cannot live alone. He prefers to live in groups and his behavior that is actions and deeds are well governed and regulated by certain rules and laws of conduct that comprises of moral ethics and civic standards. His standard of living is said to be within the†¦show more content†¦Social facts have existence as a separate entity and it does not get affected by the individual behavior. In other words, social facts are the outcome of the state of the collective mind. The stres s on the above feature makes sociology different from the rules of sociological method. Further, in favor of his argument Durkheim says that as an individual of the society the person inculcates automatically the behavioral deeds and actions with or without prior knowledge. No one is coercive on the imposition of laws and rules. If anyone goes against he is fined or a penalty is imposed for not obeying the laws of the society. To put forth his ideas in an effective manner he argues that society as a whole is an amalgamation of political platforms, partial groups such as literary schools, religious organizations etc which are bonded through certain sentiments. In his opinion, if the individual does not act in favor of a group and its principles that work for good cause and the betterment of the individuals and the society, he is made to face everything alone leading to atrocities and horrifying incidents. 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The Great Gatsby Research Paper - 1217 Words

During the Roaring twenties, social class was an important aspect of society. All different classes were for the most part separated by where people lived. In other words, by no means would anyone from a lower class be caught in an uptown setting. There are a variety of characters in the novel that come from different economic backgrounds. In the novel, The Great Gatsby, F. Scott Fitzgerald successfully uses location to differentiate social status amongst his characters while the weather and seasons of those locations help guide them. Each character helps represent and support the differences of social class and the four main locations, The East Egg, the West Egg, the Valley of Ashes, and New York City. In The Great Gatsby†¦show more content†¦In addition Gatsby has also made his fortune through criminal activity, as he is willing to do anything to gain the social position he thinks necessary to win Daisy. The Valley of Ashes represents the socially unaccepted. The charac ters in the Valley of Ashes represent poverty. â€Å"This is the Valley of Dry Bones, the Waste Land, The dusty replica of modern society, where ash-grey men are crumbling, like Eliot’s hollow men† (Bicknell 98). Myrtle and George Wilson both live in a run down garage in the Valley of Ashes. Myrtle Wilson tries desperately to improve her life and get out of the Valley of Ashes. The Valley of Ashes also represents doom and death. Myrtle is found as the victim of a hit and run caused by Daisy and Gatsby. The Valley of Ashes represents the death and dreams for Jay Gatsby, Myrtle Wilson, and George Wilson. These characters die in the novel due to misconception and anger. The characters go through the Valley of Ashes to get to New York City. New York City represents glitz and immorality. While in New York City Tom Buchanan has an affair with Myrtle Wilson. Myrtle Wilson doesn’t care about anyone except those who will direct her on the correct path to impr ove her life. 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