Zara Essay Example | Topics and Well Written Essays - 1500 words - 1

Zara - Essay ExampleSeveral leading governments are trying to implement short letter expansion strategy in order to develop a potential global client base and achieve significant market share growth. Zara has a hard global presence. The brand implemented a unique operation management strategy in the business fermentes which is tot everyy different than other retailers selling similar types of apparels. Zara is known as a vertically integrated retailer. The organization has high control on distributively and every step in bring orbit, manufacturing, designing and diffusion of the products. The company has set up its own production factory in major areas around the globe (Jones and Robinson, 2012, p.29). It helped the organization to control each and every business operation process individually. Effective integration and close look at each and every business process help the organization to maintain a strong control on production and distributions. It is discussed sooner tha t the organization adopted different operation strategy in business process unlike to the similar retailers or organizations. Zara adopted just-in-time approach in the business model in order to enhance the supply chain, inventory management, and logistics management and distribution management process. The manufacturing units are located in several parts in the world. It is true that the warehouses of Zara are located in Spain. 50 % of products are manufactured in Spain. The rest of the products are manufactured throughout the world. It is a significant example of effective operation process (Slack, Chambers and Johnston, 2010, p.97). It is true that, several leading organizations employ to outsource products and services from the parent country. It increases the outsourcing cost and supply chain cost. Glocal manufacturing and distribution process helped Zara to cut down the outsourcing cost. Now-a-days, Zara is significantly trying to expand its business practices collect to fav ourable external environmental factors. In addition to this, strong global brand name is influencing Zara to implement global expansion strategy. Manufacturing factories in different places and strong vertical integration in business model are helping Zara to adopt and implement global expansion strategy quite successfully. Question 2 Zara, being one of the leading global apparel retain chain is facing several operation management issues in its global expansion strategy. It is discussed earlier that the organization adopted vertical integration strategy in the business model. In addition to this, the organization implemented just-in-time approach in the supply chain and distribution management process. Zara believes in lowest inventor management. Zara never goes for mass production and huge inventory. According to the management of Inditex group, large inventory can tint the product quality and brand image of the organization (Johnston, Clark and Shulver, 2012, p.76). The percentag e of annual sales of Zara is lower that other potential competitors due to this reason. In addition to this, Zara apply to avoid developing inventories in its supply chain part from the resources and raw materials to the end users. The brand designs and manufactures almost 10,000 new models in every year and distributes it to all the retailers twice per week. This system actually increases the inventory management cost. The organization believes that large inventory and limited logistics activity can reduce the exclusivity of the products as the organization tries to cater quality and exclusive products to the target customers. The organization faced