Zara The Secret Of Successful Operation 17 Times A Year

Today, Zara clothing Chain stores are everywhere. If you have bought something in Zara, you may notice that its trend product is not only the latest and the most immediate. Its style changes frequently. In March this year, foreign media reported that Zara seems to have beaten some of its clothing rivals on the T stage to release the 2012 autumn and winter series, while other chains are producing fast fashion, while Zara is trying to make dazzling quick reactions.

　　 Zara Rome flagship store

How did Zara do that? Perhaps you have guessed that operation is the key to Zara's strategy.

No need for inventory design and production

Zara completed only 15% to 25% seasonal products in 6 months ahead of schedule. It only locks 60% to 70% of the product at the start of each season, which means that up to 50% of the garments are designed and produced in the season.

Nelson Freeman (Nelson Fraiman), a professor at the Business School of Columbia University, has written a 2010 case study on Zara. According to his point of view, most of the clothing retailers have designed 40% to 60% products for their series in 6 months ahead of schedule. At the beginning of each season, nearly 80% of the season's stock is finished, which means that many garments have been processed.

Planning ahead is also good. When you pay in factory time in China and the factory does not belong to you, advance booking time ensures that the factory will have enough capacity to produce products for your company, not for your competitors. At the same time, the production price is predictable and no extra cost is required for urgent orders.

But there are also disadvantages. Once you make your own bet and do not need any action, you will be right to speculate about the trend of the season. If they are not, then you have to be forced to accept large quantities of stock that can not be sold. In addition to price cuts, there are not many ways that you can take to deal with these stocks. If sales are not successful, then you have to continue to lower and spend more money on advertising to promote sales.

However, Zara completed only 15% to 25% seasonal products in 6 months ahead of schedule. It only locks 60% to 70% of the product at the start of each season, which means that up to 50% of the garments are designed and produced in the season. If lavender and velvet suddenly become popular, Zara can react quickly and design new styles. Fashion trend At the peak, the product is introduced into the store.

Zara has such strength, because it has retained a large number of internal production to ensure that its factory reserves 85% of the productivity in season adjustment. For long term products, Zara uses the same foreign factories as other companies, because the cost is relatively low, but for fast fashion products, Zara is internally produced, and it often relies on the exquisite fabric sources, tailoring and sewing settings near Spain's design headquarters. European workers earn more than their counterparts in developing countries (Nelson Freeman says 8 euros an hour, not 50 minutes an hour). But the turnaround time is incredible: from the idea to the Designer It takes only two weeks to get to the finished product shelves.

Small batch production is flexible.

Zara does not need to predict demand. It can respond to changes as it develops and new products can be delivered to stores two times a week.

This quick mid season turnover benefits from the production facilities near the Zara Spain distribution headquarters, allowing Zara to launch small batch products frequently. The new product can be delivered to the store two times a week. If the production of lavender velvet trousers is not good enough to catch up with the trend, small damage has been caused, but because of the small volume, there will not be a large number of stocks that can not be sold to deal with. Moreover, due to the end of the failed experiment, there is still time to try another style, and even after that, we can try another different style, or double the production of the best seller, or raise the price. Zara does not need to predict demand, and it can respond to needs as development changes. A manager told Nelson Freeman that Zara moved the store inventory from the equestrian theme to the black theme within two weeks of the 9.11 terrorist attack.

Another advantage of small batch is that there is very little reduction in sales. Since there is no processing, a lot can not be sold. Stock In the case of Zara, discount sales are avoided. Nelson Freeman's case study estimates that 30% to 40% of the products sold by Zara competitors are not sold at full price, while only 15% to 40% in Zara. Because customers know that every new product will be put on shelves every few days. If it is a best seller, it will soon be sold out because of a limited number. They have the power to shop in Zara stores, and each person goes to 17 times a year on average, compared with Gap or Gap in the us, only 4 or 5 times.

Japan's Uniqlo (micro-blog) is another global clothing retailer famous for its affordable prices. It is worth noting that it has taken almost the opposite approach to Zara and has been very successful. Here is a news report on Japanese UNIQLO recently published by foreign media: "the company's chief operating officer of UNIQLO said that the company can reduce its retail price because it does not change the sales plan based on the latest fashion trend. On the contrary, they will pre plan the production to the factory, producing clothing at a relatively steady speed all year round, instead of rushing to produce tidal current products from the special factory." By producing well-designed basic clothing and trying to sell them at an incredibly low price, UNIQLO can maintain customers' needs without having to catch up with every trend.

Therefore, there is more than one way to achieve the purpose of operation. You only need to find products and market strategies that are suitable for the company, and you can succeed. At the same time, remember, never order 6 months in advance to order the purple red linen short sleeved pants.