VERTICAL SUPPLY CHAIN OF ZARA

Zara encompasses a business design that follows an agile and high degree of vertical integration,
which allows the organization to react to the ever-changing customer needs instantly and approximate
arising demand and respond quickly through its capable manufacturing processes, as compared to
many of its international competitions. This business model houses all the essential components of
fashion processes in the organization, such as designing, manufacturing, logistics, and distribution to
its owned stores. This model helps shorten the turnaround time, resulting in reduced stock inventory
to a minimum level and reducing the fashion industry's risk by achieving greater flexibility. ZARA
delivers the products to its customers in a short span of 5 to 6 weeks compared to 5 to 6 months taken
by its competitors.
DESIGN AND ORDER
ZARA has an in-house design setup that comprises dedicated designers who design more than 40
thousand products, out of which only 10 thousand are approved for production every year. The design
team is inspired by global fashion trends, including inspirations from fashion shows, magazines, trade
fairs, etc. To maintain a competitive advantage, the design team works on the next season's design
demand and the market's ongoing design demand. The company launches two design collections
every year, one in the fall and one in the spring. It takes around nine months for the design team to
make initial sketches, then it is redrawn with Computer-Aided Design, then the fabric is finalized,
along with which the pricing is considered for future sale. Finally, the sourcing unit decides to
insource or outsource the production based on the product requirement. Market specialists play an
essential role in the order process, who continuously touch with the store managers for the upcoming
orders.
SOURCING AND MANUFACTURING
ZARA manufactures around 20% of the items before the peak season to gauge the customers'
response to their latest designs. Around 60% are manufactured at the beginning and the rest in
between the season, so customer response is recorded level of production. The price-sensitive items
are outsourced to Asia because the production cost in Europe is costlier at around 15%. The company
uses external suppliers for all its sewing operations. Fabrics, threads, and other essentials are sourced
from external suppliers. A subsidiary of Inditex, Comditel deals with all the dyeing, patterning,
fabrics, and external suppliers.
SUPPLIERS
ZARA has a very robust network of suppliers from all over the globe. The flexible and robust
transport system aids the model and quickness of procuring raw materials.

off
Suppliers across ZARA manufacturing
world unit in Spain

Logistics Inditex, Comidtel

Spain

Other suppliers in
Europe