Zara's success for fast fashion Essay Example | Topics and Well Written Essays - 1750 words

Zara's success for fast fashion - Essay Example The apparel industry is also marked by demand uncertainties. Managing supply chain in today’s world is challenging. The complexity is enhanced when the uncertainties are high while the product life cycle is small and the entire process involves several partners in the manufacturing, distribution and logistics (Christopher & Lee, 2001). These expose a company to higher risks in the supply chain. Zara has retained direct control over the entire process. It is hence interesting to evaluate Zara’s formula for success in the supply chain management which allows the company to design and distribute a garment in the market in just fifteen days. The global textile and apparel industry accounts for ten percent of world’s manufactured exports (Diaz, 2005). Globalised supply chains face intense competition and rapid technological changes. The global commodity chains can be either producer-driven as in the automobile industry or buyer-driven. In the apparel industry it is a buyer-driven commodity chain where the large retailers, branded marketers and branded manufacturers play an important role in setting up decentralized production networks mostly in he developing nations (Gereffi, 1999). The buyer-driven commodity chains are locally owned but globally dispersed production system and hence they derive their profits from their design, sales and marketing services. The retailer or the brand owner must have capability to shape mass consumption via strong brand name. This became the trend in 2000 as the rationale was to cut inventory and reduce risks. Retailers concentrated on reducing the unit cost and the not the lead tim e. Sourcing from low-wage countries reduces the labor costs but the lead time increases (Diaz, 2005). Zara’s competitors have to plan their launches months in advance and hence are unable to react to demand changes in the market. The upstream supply chain is dominated and influenced by technology and equipments. The upstream production