Agile Supply Essay
Due to the changing trends and consumer needs in the garment industry. It is essential to come up with modern techniques of controlling the sales of products in this industry bearing in mind that the consumer’s interest is paramount. Zara’s case study seeks to critically analyze the issue of Agile supplies chain and supply chain management. These ideas examined by Zara’s case study form the main concerns in this report. It enabled it to go the extra step not only to analyze the managerial operations, but to utilize the relevant data from the case study so as to understand the how fashion influences label companies.
The most relevant idea in this report is for it to respond and analyze the factors behind Zara’s success. It does this by highlighting the current gaps and offering a better way of conducting further research. It is getting obvious that the versatile conditions in the world market sector call for an extra agile way of responding to it. This is expected to originate from the organizations, their friends, and other stakeholders in the company society. Business has been seen to take advantage of the cheap labor overseas before, but this according to the emerging dealing trends is coming to its end.
Fast fashion business can be achieved through Supply Chain Management, which with time continues to be a success factor in coping with emerging trends in business. SCM assesses the market process from the point of the raw materials to the final part of the chain when the consumers use the products. SCM combines time, place and function of a given product or service in its undertaking. Creative techniques and fresh abilities are crucial in a fashion business. Zara, which is ranked the third biggest world retailer, has three thousand in-house designers based on its focal quarter in the region. It has managed to triple its profit and stores over the last two decades, which explains that the company has well been able to manipulate the fashion market.
It was found that the majority of Zara’s products are imitations of high-end brands. Basing on the case study, therefore, this report arrived at some summary of the main activities conducted by Zara’s Company that have ensured its success in business. Zara’s designers divided their management tasks into different sections, which ensure maximization of labor and reduction of job duplication. Zara has been given the credit of the pioneers Agile Supply Chain and researchers attribute its success to the efficiency of the ASC. The main areas that this report summarizes on the information offered by the case study includes:
The supply chain activities in its operation manage some three factors that include maximizing the resource used, minimizing the inventory and lead times. These three factors were seen to directly affect customer satisfaction, the aspect of pricing and the general business undertakings like sales and profit. It has been argued that the production in Zara should keep as little as feasible to offer the extra capacity in the products, which are needed most in manufacturing. In the process of producing fashion outfits, Zara faces high uncertainty and little complex. Ambequity is considered a virtue of competition among organizations and continues to increase due to a blend of factors in the future supply chain environment. Agile supply chain, which camouflages tactically to accommodate the changes seen in the fashion business, has enabled Zara designers adequately cater for their customers’ needs. Therefore, it has contributed a lot in ensuring its survival in the production line.
It is common for every organization to acquire some supplies, which may take the form of raw materials or equipment. This may be done through leasing or buying them for the organization. Proper procurement in an organization is what can be said to have contributed to the witnessed management success in Zara Company. In terms of the material change, procurement enables the company or any other organization to use the global markets and agile supply chain in provision of materials, which directly make an impact on the final product.
On the tables showing the relationship between strategic procurement and operational procurement, we find that they both differ in their goals. The first advocates for having goods at the right position, in the right capacity, for the right value, time, price and using the right supply. The latter in its goals supports the idea of managing uninterrupted flow of materials and services, managing the cost of operational activities and minimizing the inventory investment and cost. This table explains how procurement activities can differ, but on closer analysis, one understands that both stages of procurement, strategic and operational serve to tighten management and avoid unnecessary costs.
3. Product Organization And Design
The key task of Zara designers is not to produce innovation, but to be a reorganizing Centre for fashion elements within the existing for their purpose. They transform these products into new kinds of stuff and strive to rebrand the fashion instead of creating it. Their central source of fashion information includes information gathered by sampling the fashion trends in the streets, clubs colleges, and other leisure hubs. In their undertakings, Zara designers take into consideration different aspects including culture, generation, and locality. When it comes to ordering its fabrics, Zara company considers predicting only what might be in need of them in relation to coming up with a new fashion. They do not predict the future trend.
4. Production and Distribution
Marketing success is based upon brands and innovative technologies. Alongside these two, we can add ASC, which can respond much quicker to the versatile demand. Zara being considered a pioneer in fast fashion because of the supply it makes twice a week to its stores with new fashion supplies distributes products to its stores located in different parts of the region. The rapid turnover is one other important thing to note from Zara’s case study. It removes working capital needs and decreases short-term loans. We can also say that the efficiency of Zara emanates from a small-scale operation.
5. Sales and Feedback
A better SCM can be efficiently achieved through a prior communication between the supplier and the customers. Zara uses these facts in its day-to-day operations by informing, handling, and responding to their customers as well. They gather data on sales and inventory for each of its stores on a daily basis, which is used in sourcing the management, which, consumer needs and emerging issues on the market. Sales and replenishment managers combine data from the stores, which is forwarded to the top management. From the buffer level, sales personnel elicit information from the customers, which is seen to serve as feedback from the consumers.
Methods of Investigation
Our method of investigation is a secondary one considering that we based our report on an existing case study. Zara’s case study gave us all the information needed for our success in developing the best report on management. Zara’s case study having researched on the management, supply, and marketing issues concerning Zara designers gave the proper platform to respond to and come up with this report. The tables offered the required comparison of data, which simplified the understanding of aspects such as procurement, production, and distribution of products.
By employing our methodology, which is, reviewing Zara’s case study and literature published from the year 2001 to 2010 offered another angle of looking for management. Zara is typically a performing organization whose achievements will be used to gauge for managing other businesses. Its management has been able to surpass the usual administrative constraints that have been seen to hinder success in fashion and label companies. These among others explain our take on using this case study as the central source all the information needed for our report.
After a keen delve into Zara’s case study, some findings were brought forward by making a summary of the issues addressed to by the study. These findings have been documented in subsections, each starting with the academic theory and moving on to explain how Zara has implemented it. These results are as follows:
1. Agility And Its Impact On Supply Chain
Agility can be distinct as a reply to continues changing and unstable customer and market demand. The management factor directly affects the supply chain and it is among the factors gave rise to agile supply chain and fast fashion. For a fashion company to adequately react to the rapid change in consumer demand, Zara sought to develop a working agile supply chain. This agile supply system is seen to combine buyer experts, management, and marketing personnel all in one working zone, providing enough production facilities and agility. The necessity to decrease lead times and to practice flexibility in fast fashion ushered in suppliers in the process due to their ability of attaining high levels of customer satisfaction. The two most crucial elements characterizing an agile firm are speed and flexibility. Despite the speed and flexibility being critical in an agile organization, manufacturing should also be seen to maintain agility.
2. Retailer Power
As far as fast fashion is desirable for its target consumers, it can as well be problematic for traditional consumers. In the current marketing world, retailers opt to work with agile suppliers to avoid carrying the stock and at the same maximizing the inventory. In so doing, retailers increase their competitiveness and secure their position in the market. When we relate Zara’s case to this theory of Retailer power, one finds Zara owning its store chain, which it does not franchise, s for avoiding standard problems. Zara stores are organized in a precise manner with items differing from one another based on the buffer manager’s view or prediction.
3. Consumer Driven Process
Being extra customer focused is a trait shown by any agile company. Such companies also focus on knowing who the customer is and understanding what he or she needs. Agile companies are driven to change their service techniques, goods or even the range of services offered due to customer demands. The customer is always placed at the center of such companies’ undertakings, and that is the reason we have the term consumer driven. From the case study on Zara designers and Label Company, we find Zara to conform to this rule of placing the consumer at core of every undertaking.
4. Suppliers under Increased Pressure
Due to the changing consumer needs, it has therefore, been mandatory for Zara to work under pressure of meeting the demands of the consumer world. Zara designers been an agile company has managed to sustain this pressure from the consumers, although there are times when it becomes hard to comprehend what the customer wants. From the case study, it has been found out that Zara’s challenges as a supplier of fashion materials are majorly to do with predicting the needs of the consumer. Time constraints also contribute to these obstacles because the company always has little time to sit back and analyze the needs of the consumer. The type of service offered by Zara brings about this problem of time and pressure to perform because in this case the product is typically the suppliers idea and it is up to the consumer to take or not.
5. Elimination of Stages in the Supply Chain
In clothing business and another sale of labels, it is common in this business to have high and low seasons. Traditionally, some periods of the year like during grand celebrations and summer festivals often result in higher sales compared to other seasons whereby people are busy, and there is less time to spend outside work or school. Looking at Zara’s case there are more than 40000 items produced in a year. The items are then continuously supplied to the stores throughout the year. Zara therefore, has managed to eliminate stages of poor sales by looking at its sales in terms of the annual number. Production is left at a constant rate so that the different levels balance themselves.
Discussion of Results
The above findings are the main points brought forward by Zara’s case study. They are mainly a summary on the key undertakings that make Zara designers standout to be a successful company. Zara utilizes all the above theories of management and its endeavors come up with an efficient agile supply chain. We consider them the findings of the report because these five points address the main research problem, which sets out to determine the major measures taken in ensuring an efficient Supplies chain management and agility in the management.
In the first instance, Zara does not franchise the stores it owns because of standard problems that may arise from this action. It also eliminates the phases in the supply chain by balancing production and supply and by owning different stores, which harbor different design items. From our findings, we have understood how Zara keeps operations and concerns around the consumer, thus respecting the business theory of consumer driven undertakings. Zara’s pressure from the customers and consumers enables it to strive for satisfaction of consumer needs aided by its agile nature.
In conclusion, one finds that Agile supply chain and supply chain management when put into practical use in the running of businesses can help a great deal in maximizing sales, lowering costs and fostering productivity. The case study on Zara designers has given the best platform to report on the key activities to employ for the achievement of efficient management. Basing on the company’s achievements in the fashion industry, which is known to be a tactile one, the findings of this coverage can therefore, be applied to any other business or firm. My opinion on the case study analyzed above is that the design firm attained the success given to it due the strategies it takes to manufacture, supply, and sale of its products.
This report recommends that Zara Design Company should add innovation in the production of its designer items. Innovation will assist in bringing new ideas that will captivate the customer and give more value to the products. Predicting the consumer demand should be done by Zara Company bearing in mind that a new trend emerges from an existing one. Taking this line of prediction will enable the company to manage competition and move forward to take the top business position. Agility should be boosted in Zara designs through the strengthening of the existing measures. It has been observed in the case study that this firm has all that is required for efficient agility as stated in the findings above.