FASHION SUPPLY CHAIN MANAGEMENT

Fashion Supply Chain Management

Table of Contents

INTRODUCTION3

COMPANY OVERVIEW3

DESCRIPTION OF SUPPLY CHAIN4

KEY CHALLENGES7

COMPETITIVE STRATEGY9

VALUE ADDING ACTIVITY10

RECOMMENDATION11

CONCLUSION13

REFERENCES15

Fashion Supply Chain Management

Introduction

Supply chains represents a system of people, organizations, activities, technology, resources and information mixed up in moving a service or product from supplier to customer. Supply chains within the Fashion Industry are frequently described by various stakeholders who seek out to take advantage of their short-term revenue. The international ethical fashion movement aims to construct new production networks rooted in long-term and trust relations. Within these more complicated and clear supply chain systems, used products may re-enter the supply chain at any point where left over value is recyclable.

Discussion

In the last thirty years fashion has changed from an elite accessory of the super rich to a mass market product. Since the mid nineties, the departmental stores that traditionally dominated this broader market, have started to loose ground to specialist clothing chain offering the latest design at competitive price. Founded thirty nine years ago, Europe's fastest-growing apparel retailer, the Industria de Diseno Textil (Inditex)a sells on a global scale, with nearly 3,164 stores in 63 countries under eight banners- Zara, Oysho, Massimo Dutti, Pull and Bear, Bershka, Stvradivarious, Zara home and Kiddy's Class(Simchi-Levi, Kaminsky, Simchi-levi, 2007, pp.53-61).

Company Overview

Zara is the flagship brand of the Spanish retail group, Inditex SA, one of the super-heated performers in a soft retail market in recent years. When Indtiex offered a 23 percent stake to the public in 2001, the issue was over-subscribed 26 times raising Euro2.1 billion for the company. Zara is unique model in business world today it has its own principles which may varies from its competitors in the same industry starting from production strategy ending with supply chain management strategy, these strategies has to be examined carefully to analyze the this leading example(Ketchen, Hult, 2006, pp.573-580).

At the end of 2001, Zara operated 507 stores around the world, including Spain (40% of the total number of Inditex), with 488.400 square meters of selling area (74% of the total) and employing 1050 million euro of the company's capital (72% of total), of which the store network accounted for about 80%(Nagurney, 2006, pp.87-93).

Zara, which contributes around 80% of group sales, concentrates on three winning formulae to bake its fresh fashion that are short lead time makes more fashionable clothes, lower quantities makes scarce supply and more styles that equals more choices and more chances of hitting it right.

Description of Supply Chain

Strict control of its supply chain plays an even greater role in the success of Zara, whose 650 clothing stores serve around 50 different countries. As a result, the Spanish organization can boast an unprecedented capacity for quick response within an industry that rarely stands still(Simchi-Levi, Kaminsky, Simchi-levi, 2007, pp.53-61).

Zara has flourished on the principle of being responsible for its products all the way from initial conception to the customer. Ironically, this involves defying many industry norms. For instance, while rivals choose to minimize cost and risk by owning fewer assets, Zara only outsources ...