- 1 zara case analysis
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- 1.2 Essay about Zara Case Analysis
- 1.3 Zara Marketing Case Study Analysis
- 1.4 Zara Internationalization Analysis
- 1.5 Zara Business Model (Case Analysis)
- 1.6 Innovation in the Supply Chain: Analysis of the Zara Case
zara case analysis
TRENDS OF TEXTILE AND CLOTHING MARKET
INTRODUCTION ABOUT ZARA
Kiddy’s Class (children’s fashion)
Pull and Bear (youth casual clothes)
Massimo Dutti (quality and conventional fashion)
Bershka (avant-garde clothing)
Stradivarius (trendy garments for young women)
Oysho (undergarment chain)
Zara Home (household textiles).
THE ZARA CONCEPT
• delivery and sales
• low inventory rule
• quick response policy
• advanced IT provides quick response to customer’s changing demands
INTERNATIONALISATION OF ZARA
The internationalisation of Zara seems to follow the classic “stage model” Reluctance and trial
Between 1975 and 1988 Zara focused its expansion in the domestic market. The maturity of the Spanish market led Zara to search for international opportunities in 1988.
During this stage Zara expanded into markets geographically and/or psychologically proximate and with a minimum level of socio-economic development, adding one or two countries per year to its market portfolio.
The experience gained in the international environment made Zara more determined and intent on a rapid global expansion regardless of cultural or geographical proximity.
While Zara owns a majority of its stores in Spain, the.
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. CASE ANALYSIS #1: McDonald’s “Seniors” Restaurant In the study of the briefing of the McDonald’s Restaurant, there are positives to the problem and negatives towards the problem. A McDonald’s in a city crowded with seniors are overwhelmed with senior customers during the early hours of the day. The senior come in as a meeting area where they eat and commune at the restaurant. The number of seniors that come in, crowds the dining area in which customers come in and eat. They come in on the fourth Monday of every month to get extra special, over the age of 55 discounts. This is a meal that cost 1.99 and free coffee refills. The staff knows the seniors very well and go to see them if they are hospitalized. The relationship is considered a good one between the staff and the seniors. In addition, a idea of adding bingo to add to the excitement of the mornings for the seniors from nine to eleven a.m. Using the party room would accommodate up to 150 senior patrons. A primary problem to this case study is the senior crowd. The restaurant already takes on the task of having enough room to seat the entire dining style crowd, if it engages in bingo than the crowd will become even more outrageous. Not only will the restaurant have the meeting crowd they will have a bingo crowd as well. Meaning, that more senior crowd will come in ready and only ready to engage in bingo. A secondary problem would be the title of the.
. Bulacan State University City of Malolos, Bulacan College of Business Administration Case Analysis: A Transition of a Firm and Its Internal/External Environments In partial fulfillment of the Requirements in MGT 413e Submitted to: Mrs. Ma. Lourdes Cervantes Submitted by: Bueno, Janelle de Guzman, Rachel Joaquin, Lieme Mendoza, Danielle Montano, Darwin Ongo, Emmith Tolentino, Angelica BSBA-4A ACKNOWLEDGEMENT This case analysis project would not have been possible without the help and support of many people that the group wants to thank. First of all, everyone wishes to express their gratitude to their beloved families for their endless guidance and unconditional love. Their support for giving encouragement to do well in the task given and shouldering the financial for use to pay all the costs required to accomplish this. The group would also like to offer their special thanks to their loved ones whose support has always been the source of strength and inspiration. Also, the team’s appreciation for their friends who helped them in some aspects of the project. Everyone would like to express their very great appreciation to the College of Business Administration of the Bulacan State University, for all the foundations of knowledge, wisdom, and character that were applied throughout the making of the project. The group is also particularly grateful for the references, facilities, and.
. Case Analysis Guidelines & Suggestions Content: Your case write-up should focus on and answer all the key questions in the syllabus – do not omit any of the questions. The length limitation on this paper is short, so please jump right into answering the questions. There is no need to summarize your points in the beginning or to review what happens in the case. You must use your own judgment as to which questions need more space than others, however, remember that all claims or recommendations must be backed up by strong and rigorous analysis. Focus on analysis. A strong analysis will incorporate the concepts and materials from the class. You may include outside materials (e.g. books) in your analyses, but please be mindful of the quality of your sources especially online sources. As you are incorporating different sources, please cite so that I can see what information you are using. Remember that all claims or recommendations must be well supported. The case analysis preparation pointers (below) should be helpful. Format: Papers must be typed, double-spaced, with one-inch margins all around, in 12-point font. Include a title page with your name(s) on it and a bibliography. The text of your paper must NOT exceed 4 pages, excluding the bibliography, title page, charts, graphs, or appendices you decide to include. Please note that only.
. 152 PART II Understanding the OD Process CASE: THE OLD FAMILY BANK The Old Family Bank is a large bank in a southeastern city. As a part of a comprehensive internal management study, H. Day, the data-processing vice president, examined the turnover, absenteeism, and productivity figures of all of the bank’s work groups. The results Day obtained offered no real surprises except in the case of the check-sorting and data-processing departments. is quiet and comfortable. Both groups are known to be highly cohesive, and the workers in each department function well with one another. This observation was reinforced by the study’s finding of the low levels of turnover and absenteeism. THE INTERVIEW DATA In an effort to understand this phenomenon, Day decided to interview the members of both departments in order to gain some insight into the dynamics of each group’s behavior. Day discovered that the checksorting department displayed a great deal of loyalty to the company. Most of the group members are unskilled or semiskilled workers; although they have no organized union, they all felt that the company had made special efforts to keep their wages and benefits in line with unionized operations. They knew that their work required team effort and were committed to high performance. A quite different situation existed in the dataprocessing department. Although the workers liked their fellow employees, there was a uniform feeling among this.
How to Give a Case Analysis Essay
. CASE ANALYSES by Pamela Hubbell Cases are detailed descriptions of real management situations. In the Case Analysis your objective is to analyze the management problem and make a recommendation for solving that problem. By applying concepts to actual cases, you improve your ability to think analytically when identifying problems and creating solutions. Preparing the Case Analysis There are four basic steps to follow when preparing a Case Analysis. However, because you will encounter a wide variety of cases and problems, you should determine the appropriate approach to each situation. Generally, the four steps are: 1. Clearly define the problem. Be sure to identify the problem and not the symptom of a problem. For example, a decline in sales is a symptom of a problem; you must identify the actual cause of the decline in sales. It is also important to establish that the problem is a major problem for the company. 2. Formulate alternative solutions to the problem. It may be helpful to brainstorm as many solutions as you can and then narrow your list down to three or four solutions you feel are the strongest. 3. Evaluate and compare the alternative solutions. To evaluate alternative solutions you should consider their strengths (e.g. increased productivity) and their weaknesses (e.g. increased cost).
Template for Case Analysis Reports Essay
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Essay about Case Analysis Guide
. ISM 413 – CASE ANALYSIS FOR PREFINALS Guidelines: 1. The Case Analysis for the Prefinal Term will be done in groups, composition of which is the same with the group composition during the Midterm Case Analysis. 2. Because of the group’s composition, the case analysis will have two parts: (1) the film analysis, and (2) the minicase analysis. 3. In the Film Analysis, the group will choose between (1) Anti Trust, (2) Swordfish, and (3) Eagle Eye. Make sure that you are able to properly identify the film that you preferred before you answer the questions below. 4. The group’s analysis of the film will be based on the following questions: A. What are the manifold ethical questions addressed in the film that you chose? In what way were they presented in the film? B. In what specific way did Nurv Company (Anti Trust); OR Government (Eagle Eye); OR Gabriel Shear and Ginger Knowles (Swordfish) fail to uphold its ethical responsibilities? C. Who, do you think, is the main character in the film? Describe the character’s contribution in solving the issue of the film. D. What is the main problem discussed in the film? Please cite the specific scene in the film presenting the complex nature of the problem. E. How did the film end? Explain the various processes that led to the solution of the problem. 5.
Flextronics Case Analysis Essay
. Flextronics Case Analysis Team Member: Kerry Cunningham, Feng Hu, Tian Tian, Shuo Zhang Nov. 5th 1. Cause of McCuster’s Dilemma Several organizational factors haves contributed to McCuster’s dilemma: First, the Flextronics’s decision makers failed to appropriately evaluate the ability and condition of the organization in bidding for Xbox project and assigning tasks. While it is enticing that this project would bring about good reputation as well as substantial financial gain, decision-makers should consider more than financial benefit1. Managers are paid to make good decisions not risky decisions or conservative decisions1: Flextronics decision makers was too optimistic about the project so that they promised Microsoft the IT solution Flextronics did not have yet despite the fact that it was Flextronics first global project and first foray into sophisticated software. This promise has put Flextronics in risks since now it has trouble coming up with the IT solution. Although group and external pressures (social, political, economic) impact the alternatives we select and biases we have in decision-making1, in Flextronics case, Flextronics could gain cutting edge and good fame from the succeed of the project, and many parties are closely watching this project, decision makers still needs to be objective when making decisions While Xbox project needs the two facilities designated to work closely, decision makers.
Focused on manufacturing affordable yet high fashion concept apparels for women, men and child, Zara is one of the most popular fashion brands in the world now. It is also one of my most frequently visited boutiques. The success of Zara is not a miracle; it is the result of successful operation management. First of all, Zara has a special planning and design cycle. Zara hires 200 designers and make 11,000 styles of apparels every year, which is about 5 times as many as comparable retailers produce each year.
Zara’s production is based on small batches, and this reduces the throughput time. Zara’s timeline began one year in advance of the start of the corresponding year, which means designers start working on the initial ideas for 2013 Spring/Summer collection since 2012. After finishing the initial design collection, the company produced only 50-60% of in-season apparels in advance, with the rest being manufactured on a continuous basis after they are available to the public.
Competitors like H&M and Gap, on the other hand, has 80% of its apparels produced in advance, which lead to great amount of inventory in warehouse and high probability of leftovers. This will hurt the companies’ bottom line as the leftovers are usually heavily marked down at the end of the season. Because of its continuous manufacturing method, Zara does not have high amount of inventory and has significantly less leftovers that need to be discounted and would result in loss.
Zara can focus on manufacturing only popular collections and thus maximize its profit. However, this does not mean that Zara will satisfy all consumer needs on popular apparels and Zara actually does this on purpose. I think many of us have the experience of being disappointed because we cannot get some amazingly designed Zara apparels as it is sold out and it is never available again. Zara actually does this to make its customers think that they should get it now before it’s gone forever.
The believe of no second chance makes customers buy what they like immediately without second thought. Also, as Zara launch new collection of clothes every two weeks, customers tend to go back to the shop frequently to check out for new collections. This will increase their revenue as well as the more customers come, the more they spent. Last but not least, its distribution is effective. All finished apparels are gathered in a distribution center in Arteixo, this distribution center is carefully selected, as it is nearest to ll manufacturing plants.
Besides shipping cost, Zara also saves inventory cost by doing frequent shipment (two times a week). In order to make the sorting process more efficient, Zara made uniform price tag that includes prices in all currency for apparels shipped to different destination, so that shipping staffs will not need to sort the products when they ship. In conclusion, Zara’s success is one of the best examples of successful supply chain management and it is worth study by everyone who is interested in business.
The market is thus lowly concentrated, if observed as a whole; but one could argue that given the diversity in business models, products sold, targeted customers and business strategies, the clothe retailing Industry should rather be analyzed as segmented different Industries -? which we will not do here. Internal rivalry is quite intense, opposing very different types of players. Interestingly – and counter-intuitively-, we state that threats of entry are high. As new opportunities arose with the latest technological developments, the last decade has been Industry-shifting, seeing the emergence of many TV and online retail impasses.
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However, we can assume that this trend will be progressively decreasing, most major actors responding to the threat by developing their own online retail channel. Moreover, important manufacturing economies of scale, slow learning curves and high labor costs In developed regions tend to prevent companies with minor Investments and unclear strategies to successfully enter the market (the 80% failure statistic previously mentioned highlights how a lot of new entrants are trying to find their place, but are having a hard time to sustain their business on the long run).
The threat of substitutes Is on the other hand high If we keep looking at the Industry as one: It Is Indeed difficult Imagining people substituting their clothes with another type of good (unless they have very particular and peculiar lifestyles). The clothing retail industry has one major advantage: its potential customers are every one of us. Nevertheless, as a subset of the retail industry, apparel retailers are competing with all other types of retailers (wholesales, convenience stores… ), and some of the biggest clothe retailers are general retailers (Wall-Mart).
Clothing retailers eave to ensure that customers want to spend their extra money on clothes rather than any other type of good. The drawback of this assertion Is that customers bargaining power Is very high. As the industry Is heavily dependent on Individuals’ spending, competitors have to provide them with the services, quality and prices which will optimize their will to buy clothes. The market being drastically segmented (by age, sex, location, income, season … ), most competitors can’t target more than two or three groups.
A direct consequence of that Is that each target group Is accounting or a very large part of each retailer’ total sales, giving the customers an Interesting bargaining power. Moreover, economic downfalls tend to reinforce this bargaining 1 OFF clothing. Finally, suppliers’ bargaining power is moderate: if retailers critically depend on them to ensure quick and quality delivering (to follow the ever-changing fashion trends), they also have a large number of low-cost suppliers from emerging countries at their disposal, giving retailers the edge when it comes to negotiating partnerships.
Overall, the industry appears moderately profitable, with an interesting pool of attention customers, but requiring a clearly defined and differentiated strategy to resist the expected retaliation from industry leaders. In this context, Sara’s competitive advantage comes from several elements. First and most important is its capacity to articulate its whole operational system around its quick -response strategy. From its core competencies to its end products, everything is made not only to follow fashion trends, but even to impose new fashion cycles and create an atmosphere of scarcity around its products.
Its vertically integrated business model gathering specific design, Just-in-time manufacturing, centralized striation channels and low marketing provides it with more flexibility than its rivals. Second, Ezra did not focus Just on operational effectiveness (I. E. Doing what the others already do, but better); it also searched for a different strategic positioning. In doing so, Ezra shifted the industry strategy by becoming much more capital intensive, but also flexible than others, and by increasing the buying frequency of its customers. Why hasn’t any competitor reacted to this incredibly successful strategy by following it?
The quick-response system is very demanding: the whole structure of the many has to be oriented towards a simple idea: being time-consistent and following the market’s trends. This implies technologies, operational organization, a strong commitment from all the value chain activities and a special mindset of the management teams. Not only are these elements very hard to replicate if not initially integrated in a business model, but they are also very hard to understand and spot in a competitor’s strategy, as they don’t necessarily reflect on the final product.
This can explain why Sara’s competitors don’t have implemented this strategy before, nor after Sara’s development in the industry. But we bet this won’t be the situation for long. To successfully compete in the apparel business, Ezra implemented proceeds which together made an original answer to the В« Quick response В» solution. Most of these proceeds are listed on the following graph. More fluctuating consumers’ aspirations. So they adapted the four main phases of product cycle to make perpetual evolutions possible.
In the design phase, Ezra renounced to pay expensive maestros to guess or inspire future fashion standards. They preferred to constitute “flat” teams with some designers and product placement managers to create quite fashioned products at the beginning of each season and make these products evolve. Moreover, Ezra design teams work both on two seasons, perpetually modifying the current collection and choosing products which will base the future one. In the sourcing and manufacturing phase, Ezra keeps a strong regard on production.
Regarding to the sector standards, a large part of it is internalized by Ezra, and, most often, Ezra or a direct Galilean subsidiary dye outsourced products and put garments on it. Long-run relationships with furnishers evolve. The distribution phase is based on the really performing Artesia centralized distribution facility, near the headquarters. This place in which managers Just want to “make the products moving”, every outsourced and domestic production is receipted, and redirected to retailers. No clothe spends more than three days in the warehouse.
The retailing phase is maybe the most important one. Without allowing much money to media advertising, Ezra created an ambiance by installing a “climate of scarcity and opportunity’ in its stores. We could talk about “instantaneous fashion”, customers know that a product may not stay more than two or three weeks on the shelves, and that if he/she likes it, it is necessary to buy it immediately. To conclude, we see that Ezra created and maintained a competitive advantage by building an entire system to follow fashion evolutions, and to make its products quickly evolve, without any extra cost.
The combination of permanent design, sophisticated production proceeds, really efficient distribution systems, and fast-changing retailing allows Ezra to remain permanently fashion, and guarantees customers’ interest. Growth and geographical expansion have created new working conditions for Ezra and involve several risks threatening its successful business model. First, as it is said in the case, the opening of new stores worldwide poses an issue to Sara’s centralized logistics’ and distribution system, composed of two warehouses situated in Spain.
Indeed the stock capacity and automated products’ distribution, that have to maintain operational rapidity to back Sara’s competitive advantage, risk not to match the firm’s expansion and turnover, ultimately basis to discomposes of call as it grows. Distribution facilities, a crucial element of Sara’s value chain, are not able to meet retailers’ requirements, creating additional costs and lowering margins. As Ezra enters international markets, it is submitted to new costs for shipment, logistics, tariff….
The centralized system has to be transformed to adapt its new working conditions and not lose its competitive cost advantage: manufacturing and distribution activities should be moved to international important market positions. Second, there is a risk in the method chosen by Ezra to enter new markets: ended, going with franchising or Joint-ventures could damage Sara’s image. The firm will have a smaller role in managing the local stores. If it is done badly or the store doesn’t fit Sara’s specific strategy and marketing positioning for that country, it could be dangerous for the brand.
Another risk Ezra faces in pursuing international expansion is associated to the important capital investments this implantation requires: indeed Ezra has to use its resources to train the management to lead their facilities according to Sara’s peculiar business model, and to build the IT and logistics accessory to transfer information and data to the headquarters, as knowledge seems to be one of the most important element of the production’s chain. Increased costs are likely to be passed on to the consumer, and we know Sara’s competitive positioning goes with low to medium prices.
Thus it is the margins that will be threatened of shrinking. Additional risks are proper to the geographical locations Ezra is considering. For example, Asian and US market are highly competitive and entry is difficult. The Americans are not as fashion oriented as the Europeans; implantation of Ezra and make the firm lose a lot of money. Nevertheless, Ezra can keep on sustaining its growth thanks to its current competitive advantage, and thus avoid these reefs. Indeed, as previously mentioned, its core competencies are not easily replicable, which gives Ezra a relative margin to benefit from them for some time.
The company keeps its operating income high, has a strong and unique business model, as well as various opportunities for expansion in the retail industry. After a comparison of the financial statements of Ezra and its major challengers, we come to the conclusion that Ezra has a stronger financial Truckee than its competitors. Its profit margins are higher, therefore it will have more money to invest and cover expenses than other retailers. The competitors of Ezra, like H, lower their costs by outsourcing the production.
Ezra manufactures 60% of its own products. It is outsourcing less and produces the most fashionable items that tend to be the riskiest internally. It will be very difficult, time- and money- consuming for other major players to shift their manufacturing process from an outsourced one to a fully integrated one. Vertical integration, a distinction of Sara’s equines model, has allowed the company to successfully develop its strategy. It led Ezra to implement a climate of scarcity and opportunity.
By owning its production, Ezra is able to be flexible in the variety and the quantity. The other competitors lack this flexibility, and remedy this situation would take a profound change of business model. Sara’s target market is sensitive to fashion. Fashion has become more globally standardized and Ezra uses this to its advantage. 80- 85% of the products that Ezra offers globally are relatively standardized fashionable products. However, Ezra also as difficulty to penetrate the American market.
This is due to American tastes that differ from European preferences, but also maybe because of its European strategy that does not match with the American apparel market. In order for Ezra implement its differentiated strategy in the US, and to offer specialized products according to North American tastes, a good idea would be to create a second distribution centre in the US. This would enable Ezra to supply its shops more efficiently and focus more easily on its American strategy. To sum up, Sara’s competitive advantages are sustainable compared to the other detail competitors.
Its core competencies are mainly the high turnover rate of products, good stock management, efficient distribution channel, quick adaptability to market needs, internal production, vertical integration, and quick response system. Other apparel retailers found it difficult to imitate Sara’s business model as it would need them to change their entire model and strategy. Ezra chose a quick-response system which is not easy to implement and doesn’t guarantee the viability of the retail company, but proved to be one of the most successful in the industry.
Essay about Zara Case Analysis
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expected to show high resistance in response to it. Even though Zara has a decentralized decision making process, the retailer’s IS department exercises absolute autonomy on the IT infrastructure and design. The fact that “only one person had left the department” in the past 10 years further confirms that the retailer is suffering from cognitive and action inertia, and thus creating a huge barrier for such upgrade. Nevertheless, Zara should still perform such upgrade in the long run. Q1b. Should…
Autor: goula16 • April 25, 2016 • Case Study • 1,332 Words (6 Pages) • 210 Views
Founded in 1975 by Armancio Ortega, Zara is a very successful Spanish clothing and accessory realtor and the business that started the Inditex Group empire. Zara started in a small Galician city known as La Coruna in Spain and has grown to be a retailer powerhouse with over 6,000 stores in 85 different countries. The number of stores and locations is constantly changing since Zara is known to open more than a store a day in past years. Zara has become the giant they are today because of their differentiated business model, this system has not been copied by any competitors which gives Zara a great competitive advantage.
Zara’s business and operating model is focused on speed and the need for fast fashion, targeting young fashions, price conscious people and is built on a vertically integrated system focused on supply and demand. Zara is constantly updates its design and production based on customer buying habits and the latest trends to deliver exactly what the client wants. They are very close to their customers and gives them what they want.
The integrated IT system is crucial to Zara because it allows it to have such short and precise product cycles. Store managers can report directly to the production centers and designers in Spain while also being able to check on the latest clothes designs and place their orders with the buying trends observed in-store in mind. This makes the whole process for Zara more streamlined. The production centers in Spain work on-demand and deliver the product in unbeatable market times. By reducing the quantity of each style produced there are more styles but only for a limited time, so buyers purchase more often since they realize that what they like might not be there next week. Buyers also come to the store much more often than other retailers since the collection is constantly changing. The location of their shops in prime locations and having a minimal advertising budget is another key aspect of their business model.
Zara's goal is to reduce any waste and to produce on-demand where and when the client needs it. Each part of their process is essential in providing this. It also puts the decision-making in the hands of the store manager who is closest to the clients. This in turn optimizes sales and reduces wasted time and unwanted products. This system is also absolutely unique to Zara. Many other retailers are now trying to be copycats. The only problem for competitors is that it requires a fully vertically integrated supply chain system full of designers, manufacturers, transporters, well trained store managers, and fully integrated IT systems. The production structure of Zara puts it in a vulnerable position. This is because every part of the value chain is vital for the effectiveness and value creation for the company and if executed correctly it adds value.
Zara and H&M are huge competitors and H&M does things differently than Zara. H&M's value chain is made to mass produce and does not need to rely heavily on short lead times. They uniform the brand and marketing to focus on products that are suitable for an international market instead of focusing on the smaller batches like Zara does. H&M also should be able to keep costs to a minimum due to it mass-producing with larger lead times. There are of course many disadvantages too. H&M cannot play on newer trends and produce goods only bound to be best sellers. They also have the disadvantage of clients visiting their stores three to four times a year instead of every three to four weeks as in the case for Zara.