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Zara. Group H Ang RuixianU096845Y Chia Joo Leng JasmineU097028B Nah Zheng Xiang PhilsonA0067379M Tan Hong Chuan JulianA0067407A Tan Jian YueA0075054J.

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Presentation on theme: "Zara. Group H Ang RuixianU096845Y Chia Joo Leng JasmineU097028B Nah Zheng Xiang PhilsonA0067379M Tan Hong Chuan JulianA0067407A Tan Jian YueA0075054J."— Presentation transcript:

1 Zara

2 Group H Ang RuixianU096845Y Chia Joo Leng JasmineU097028B Nah Zheng Xiang PhilsonA M Tan Hong Chuan JulianA A Tan Jian YueA J Wong Chih YongA E Our Team

3 Introduction Competitors Updates Challenges Recommendations Presentation Agenda

4 Introduction

5 About Zara Founded by Amancio Ortega In 1975, the first Zara store was opened in La Coruna, Spain Inditex was formed as the holding company atop of Zara, other retail chains & a network of internally owned suppliers (1985)

6 Focused on opening stores in prime city locations Rapid response to market demands Offer new clothing styles faster than its competitors Inditex has become one of the world's largest clothes makers in the fast fashion industry 1,671 branches in 78 countries worldwide About Zara

7 Zaras Supply Chain Maintains control over its product design, manufacturing, distribution & retailing operations 1. Design 2. Production 3. Distribution 4. Retail Consists of 4 Phases:

8 Competition

9 Closest competitor Hennes and Maurtiz (H&M) Founded on 1947, Sweden Innovating around design and distribution Supply Chain Phases Design, Production, Distribution and Retail Competitor

10 Production Phase Outsource production process 60% in Asia, 40% in Europe Low production cost to maximize profit at Asia Implications to Zara No production outsourcing Higher overall production cost H&Ms Supply Chain

11 Distribution Phase Distribution center(DC) located at every country Daily replenishment to increase stock turnover rate Able to meet customers demand on time Implications to Zara 2 Large DCs located in Spain Slower replenishment rate Unable to meet customers demand on time

12 Retail Phase 40% lower product selling cost compared to most competitors Implication to Zara Higher product cost due to higher production cost H&Ms Supply Chain

13 Competitors Challenges Zara faced against H&M Higher production cost Slower replenishment rate Slower at meeting customer demand

14 Updates on Zaras SCM

15 Retailers Work Process Distribution Network and Centre Inventory Management Updates on Zaras SCM

16 Shifted to third party logistics providers Shifted to factories Enhancements made to PDA Retailers Work Process

17 Consolidated transportation across Zaras different brands DCs are equipped to handle small scale customer orders Distribution Network and Centre

18 Implemented sophisticated inventory allocation model Inventory Management

19 Challenges Faced

20 1.Limitation of company wide interconnectivity 2.Obsolescence and Limitation of Technologies used Challenges

21 Challenge 1 Discrepancies between orders and sales data More time and energy spent on administrative work Discrepancies between orders and sales data More time and energy spent on administrative work

22 Challenge 2 Any upgrades for existing machines rendered DOS-incompatible No guarantee from vendor Core operations at risk DOS outdated, no longer supported Zara disadvantage Store managers need more functions Business continuity at risk Limited capabilities Unable to find vendor to supply or service hardware Hard to find developers for outdated platform Limited capabilities PDA becoming obsolete

23 Mobile Enterprise Applications

24 Run complete OS software Useful functions for SCM execution Gradually Replace PDAs Our Recommendation

25 Benefits Timeliness and Correctness Instant access and updates Improve cycle time & efficiency Employee Responsiveness Better reachability Scalibility & Updates More functionalities

26 Challenges Addressed Obsolescence of PDA Systems Technical support issues Limited Connectivity Information Sharing Data Discrepancy

27 Feasibility Evaluation Cost Require customized apps Time Training for personnel

28 Upgrade POS Terminals

29 Intuit-HP Retail Solution HPs POS Software Full fledged Mouse & Keyboard Industry-proven software Gradual replacement of DOS systems Phased Approach Our Recommendation

30 Benefits Interconnectivity between stores Merging of data into one system Precise measurement of stocks Global trends and developments Real-time information sharing React faster to sales information Improve decision making

31 Limitations of Existing Network Automatically collect and process data Reduces need for calls & manual checks Increasing obsolescence of DOS Modern, widely supported OS Reduce reliance on sole vendor Future-proof their operations Challenges Addressed

32 Feasibility Evaluation Staff adaptability to change Need to ensure sufficient training Empower staff to fully utilize system Risks associated with change Use phased implementation approach Test stability on pilot stores

33 Conclusion

34 ZARAs competitor (H&M) The need to stay competitive ZARAs SCM updates Importance of continual innovation Challenges & Recommendations Innovations through cutting-edge technologies Conclusion

35 Questions & Answers


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