MINI CASE

Zara: The Capabilities Behind the Spanish "Fast Fashion" Retail Giant

Zara is a Spanish fashion company that demonstrates the value of monitoring the external environment and ensuring that the company uses its core competencies to meet environmental needs. In Zara's case, there are two critical goals: to give customers what they want and get it to them faster than anyone else. To meet these goals, Zara focuses on fast fashion design and using data from commercial sales specialists who provide input on customer's tastes and buying habits. By also managing its supply chain very efficiently, Zara can get new fashions to stores very quickly. This encourages customers to visit Zara more frequently and to buy clothes quickly. Because Zara maintains close relationships with its suppliers and operates its own dyeing plant, it has more control over its products than many companies do.

Note that Zara got their idea for their supply chain from Toyota's "just in time" approach to supply management and how Zara's supply chain would operate based on just in time management.

Mini-Case Questions:

Please answer the following questions. You can browse the internet for further information about the Zara fashion company in addition to the information above.

1.What influences from the external environment over the next several years do you think might affect the way Zara competes?

2.How easy or difficult do you think it would be for competitors to imitate Zara's supply chain as acapability?

3.Is getting products to customers as quickly as possible an outcome that you believe would createvalue in industries in addition to clothing? If so, which industries and why?

4. What value does Zara create for its customers?

5.As you study how Zara competes and the capabilities it uses to do so, are there areas of thefirm's operations you believe might be candidates for outsourcing? If so, what areas and why mightthose be outsourced in the future