Analysis of the operations management activities of zara Essay

Analysis of the operations management activities of zara - Essay Example The organisation that has managed to pull this off is Zara, the Spanish fashion retail chain. Not only has Zara continued to record rising profits in a stagnant market, but is increasing the pace of store openings to almost one per day in the current year. Currently there are 758 Zara stores throughout the world in 58 countries, but by 2009, there are planned to be 4000. (Kane 2005). The company is not just a European phenomenon, but a global force and in many ways could be considered a leader in the retailing revolution that is sweeping the fashion world. Zara is a company within the Inditex holding group also founded by the creator of Zara. Before looking in depth at the successful business model that Zara operates and how it was developed it is worth looking at the overall fashion scene in order to gauge the field and to further show how different Zara is and how it became and remains so successful. Without doubt, there is a fashion revolution underway in the High Street. This revolution underscores a fashion retailing war that can only be described as cut throat and it reflects a huge change in the underlying cause of fashion expectations amongst the shoppers - the huge reduction in cost of high fashion items which has been pioneered by such fashion retailers as H&M of Sweden, Top Shop of the UK and especially Zara of pain. The war has had many casualties which have been mortally wounded amongst them C&A and M&S which catered for the wrong people at the wrong time and ended up with millions in unwanted unsaleable stock. Other companies struggled through the bad patches and are fighting back to remain in the high street realising belatedly that shoppers all over Europe and indeed the rest of the world want to dress like the rich and wealthy and the stars of stage and screen. Fashion retailers are rushing to satisfy this demand and shops like Top Shop, gap, Zara and others are b attling it out to get ahead and stay on top in this cutthroat and swiftly changing business. The market in Britain alone is worth 27 billion pounds and decisions made by company and group managements right down to store managers together with their chosen business models make the companies sink or swim. A BBC report on the subject (BBC News 2003), noted that shoppers had become obsessed with the way that celebrities dressed because those clothes have become so much more accessible in both price and availability. Stores are becoming that much better at including items that celebrities wear and reproducing them very quickly. The same report quotes Top shop director Jane Shepherdson as saying that customers want to be able to buy into the trends that they've seen from the catwalk as soon as possible. Top shop wasn't always able to accommodate this because of its inflexible business plan that operated separate summer and winter collections which often had lead times built into the system of up to 18 months. By observing another rival on the high street scene, Gap, it can be seen that by relying on previous problems were due to a mistaken strategy of targeting the teenage market with its Old Navy stores. The Swedish firm H&M was one of the leaders in changing that by appointing young designers to make high fashion as swiftly and as cheaply as possible, but initially the quality