Zara's Supply Chain Methods Case Study Example | Topics and Well Written Essays - 1750 words

Zaras Supply Chain Methods - Case Study fountThe USP can be identified using the business model of Zara and by understanding its competitive progress over other players in the market. The case also aims at developing a strategic compendium of the market conditions, communication, branding and the competition faced by Zara.Zara does not advertise as much as its competitors. Its average advertising spend is 0.3% while 3-4% is the standard industry spend. This gives them a strategic cost good against their competitors. This also makes their expansion strategies more economical. The main alternative to advertising used by Zara is its store layouts and displays. Zara has a team of around 200 people exclusively working on acquiring global set real-estate locations. They argon also responsible for frequent refurbishing of the stores and creative window displaying. There is a testing knack in their headquarters where different layouts are tested and the best is selected for various sto res at different locations.The gay business model of Zara helps them in reducing their advertising store by giving them alternative options to describe customers. This is by influencing the buying behaviors of customers. Zara updates its collection twice every week. So a usual customer of Zara knows that untried styles will be awaiting them every week, making them want to pay another visit very soon. Also, if a customer does not find anything interesting to buy, he knows that he will get more choices in the coming week. New styles in Zara are added very frequently, but are not replenished. This creates a scarceness and the customers of Zara pay frequent visits to the stores so that they dont miss out on certain styles. Zara, because of its unique branding has got itself a cult image through the years. Each Zara store is redesigned every 5 years to keep up with the current fashion. Zara targets a broad range of customers and do not define their target market by age and lifestyle like traditional retailers. They target people of all age group who are educated and are sensitive to fashion and react to changes in fashion. As fashion is more globalized in recent times, Zara offers standardized fashion wear. Also, their pricing strategy is different. Outside of Spain, and particularly in the UK, it is based on more premium prices. Partly to compensate for higher distribution and rental costs, prices can be up to 40 per cent higher. Zaras positioning as an aspiration brand in the UK has the added benefit of giving the wisdom of clear water between itself and mass-market fast-fashion rivals such as New Look or H&M.strategic ANALYSIS USING ANSOFFS MATRIXMarket Penetration systemThrough its unique business model, Zara encourages its vivacious customers to buy more. Every new style reaches the store shelves from design table in about cardinal weeks. This fast-fashion methodology helps in remaining updated to the latest trends and makes the customers visit the sto res more often. This quick inventory turnover is referable to its vertically integrated supply chain and its total control over its system.Market Development StrategyZara identifies potential segments in the market as a first step in their market development. By giving equal importance to all such segments, Zara