2. For the young, fashion-conscious city dwellers
Taste in clothes changed rapidly—hard to predict and influence
High end couture styles for lower prices
Sophisticated interior design-updated every 5 years
THE ZARA EXPERIENCE
4. The idea of Zara was created by Amancio Ortega.
Partnered with Jose Catellano Rios, Inditex CEO
Inditex-Multinational clothing retailer and manufacturer
The first store opened in 1975
Headquarters are in La Coruna, Spain
Presently in over 73 countries
ABOUT ZARA
5. “Link customer demand to
the manufacturing, and link
manufacturing to
distribution. That is the
idea we still live by” –Jose
Maria Castellano Rios,
Inditex CEO
Different from average
retailers
Focused on turning around
delivery time within 3
weeks
Producing clothes worn by
celebrities with quick
turnaround
THE UNIQUE IDEA
10. Ordering-Store managers order based on needs from hand-held devices
Handheld device shows, photos, available garments etc
Fulfillment-allocated by commercial team, delivered to stores right
away
DC to store right away
Design and Manufacturing
Difference-regularly buy for two seasons but continue to develop more in
between
Operate with short lead time.
Own facilities that are quick to produce new garments and textile.
OPERATIONS:3 CYCLICAL
PROCESSES
11. Salgado and Castellano focused on what
new systems were needed if any.
No justification of IT efforts and no
cost/benefit analysis
Wrote applications themselves and made
own accounting software
The IT department had 50 people from
local universities and divided in 3 groups:
1. Store solutions
2. Logistics support
3. Administrative systems:
Staff retention wasn’t an issue. Only one
person has left in 10 years
INFORMATION TECHNOLOGY
12. Inventory was used to simply make allocating decisions. Having 100% control
on inventory
The applications just presented managers with quantities and due dates.
Most of the sophisticated technologies were put into equipment like cutting
clothes and patterns
Hand held devices were known as PDA’s (Personal digital Assistants. This
was because faxing order forms back and forth was too complicated.
PDA’s are constantly upgraded
INFORMATION TECHNOLOGY
CONT.
13. Salgado wants to change the system. The Sanchez doesn’t
DOS (Disk Operating System)
-Stopped being supported by Microsoft in 2003.
-But it was easy to maintain over time due to the POS application
that ran on top of it
The system for new stores now is simple:
-There’s two floppies with all the applications needed
-If something happens and software reinstallation was created.
Daily sales were copied onto floppy disks. POS terminals and PDA’s
couldn’t share information.
THE CASE
14. Would upgrading to a modern operating system put a risk and robust the
infrastructure?
The hardware vendor said they weren’t planning on changes its machines so
that it won’t run on DOS
Should Zara updated to windows UNIX or Linux?
Should they build new capabilities into the software?,
Updated apps could have larger screens and key boards. They can go wireless.
Stores can do inventory transfers.
Update floppy disks?
CASE CONTINUED
15. Adaption to change needs smooth transition
Wireless-easier on costs
Cross information between PDA and POS
Switch from floppies, information can be linked together
IT Training, store training
Advantages
-More capabilities, better capabilities, larger screens, execution of returns, data,
cost efficient, no floppy disk, sales available via internet, inventory availability,
avoid phone calls
ANALYSIS
16. Keeping it the same
Convenient, safe, and successful
Disadvantages: Newer and better capabilities limited, adaptability to change,
possible expansion
ANALYSIS
17. 1. Describe the Zara Customer?
a. Fashion-conscious city
dwellers
b. Missy
c. Conservative
d. All of the Above
2. Where is Zara’s corporate
headquarters?
a. New York
b. Spain
c. Italy
d. France
QUESTIONS
3. Zara’s Marketing Idea consists of
which of the following?
a. Annual Sales
b. New Store Openings
c. No online store
d. All of the above
