Zara Problem Solutions Essay Example

Zara Problem Solutions Paper Ezra stores receive new merchandise two to three times each week, compared to four to six times per year for most clothing retailers. More and smaller batches of items translate into fashion exclusivity. This in turn results in fewer mark-downs and higher profits. Ezra controls a true vertical marketing system. A good portion of the channel participants are centralized geographically around its corporate headquarters in a remote corner of Northeast Spain, rather than spread out around the globe, This and its IT system are what allow it to achieve the speed and responsiveness that it does. Discussion Questions I. As completely as possible, sketch the supply chain for Ezra from raw materials to consumer purchase. As the case points out, finding the starting point oaf product concept is hard to nail down With Ezra. But the following is an attempt to do this: Design: The starting point is a collaborative phase that includes teams of creative professionals who carry out the design process and store managers who spot trends and feed data to corporate. Materials: Ezra makes 40 percent of its own fabric. It is not clear from the case where the other 60 percent comes from, but given the information on the rest of he process, it is likely purchased more on a local basis than on a global basis, Cutting: Ezra produces more than half of its own clothing, It cuts all fabric in- house at its complex in Spain. Sewing: Cut fabric and designs are sent to one of several hundred local co- operatives, Ironing: Ironing is performed in-house by provokers trained for a specific task (lapels, shoulders, etc. ). Final preparation: Clothing is wrapped in plastic and transported on conveyors to local Ezra-owned warehouses. We will write a custom essay sample on Zara Problem Solutions specifically for you for only $16.38 $13.9/page Order now We will write a custom essay sample on Zara Problem Solutions specifically for you FOR ONLY $16.38 $13.9/page Hire Writer We will write a custom essay sample on Zara Problem Solutions specifically for you FOR ONLY $16.38 $13.9/page Hire Writer The automated warehouses sort, pack, label, and allocate clothing items to specific regions and stores. Delivery: Stores within a 24-hour drive receive deliveries by truck. All other stores receive their goods via air parcel. Sale: All stores are company owned. 2. Discuss the concepts of horizontal and vertical conflict as they relate to Ezra. There is little information given in the case regarding channel conflict. But one could easily speculate as to the outcomes. Because Ezra owns much of its own supply chain and exhibits an extreme amount of control over the elements that it does not own, conflict is likely minimal. With respect to horizontal conflict, the only members of the supply chain on a horizontal level would be the hundreds f local sewing co-operatives. It is difficult to imagine the type of complaints that such co-operatives might vague against each other that would affect Ezra. However, horizontal issues might result in vertical conflict. Ezra owns much of the supply chain. Thus, any conflict would be internal and could be handled in a much different manner than fifth entities were independent. But the co-operatives are not company owned. Because there are so many Of them, however, conflict should be minimized as Ezra has plenty of options. 3. Which type of vertical marketing system does Ezra exhibit? List all the infinite that Ezra receives by having adopted this system. While Ezra does not own all of the stages of the vertical marketing system, it seems to have a strong control over those that it does not own. Saras system fits the description of a corporate VIM better than it fits the contractual or administered systems. The text provides an outtake example of Ezra in the section on corporate VIM that illustrates the benefits that Ezra achieves through this structure. These include control over almost every aspect of the supply chain, more items produced, taster design-to-shelf times, lower inventories, ND more frequent shipments. In short, Ezra is faster, more flexible, and more efficient than other fashion houses and chains because of its corporate VIM. 4. Does Ezra incur disadvantages from its fast-fashion distribution system? Are these disadvantages offset by the advantages? One disadvantage that Ezra incurs is possibly a higher cost on materials and labor by not sourcing globally to the cheapest source. This, however, is offset by the cost savings of not having items shipped all over the world. It is also offset by dramatically faster response time between each stage. Because Saras nominative advantage is the fast part Of the fashion, this is much more important than the minimal amount that Ezra could save by sourcing globally. 5. How does Ezra add value for the customer through major logistics functions? Warehousing: The only warehousing done in this system is local and brief for the component parts and the finished items. This adds value by cutting down on costs associated with warehousing and by decreasing the time-to-shelf. Inventory Management: The IT system and the VIM in general both contribute to Saras ability to offer a just-in-time system. This results in lower inventories, cut sots, and taster throughput. Transportation: Saras shipping system is certainly quick. That is the big advantage, Shipping by air freight to individual stores is not the cheapest way to go. 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