HOW ZARA OPTIMIZED ITS SALE DURING THE PANDEMIC WITH ITS INGENIOUS INVENTORY STRATEGY
The year 2020 has seen a lot of damage to the commercial business sector. The retail business had the worst impact as their stock inventory management had a complete setback. The retail establishment stores were on a complete blackout, and many businesses ended up abruptly. It was puzzling for many companies because the surroundings affected and impacted them a lot. The fashion retail businesses come to the first place of demolition in terms of winding up as the goods and the fashion always had a head clash between them. This becomes difficult for the company to reconstruct itself.
Cracking a marketing case study on Zara’s success
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It is difficult for many companies in fashion designing to withstand market problems. But, Zara is acclaimed to be the prosperous industry in the fashion technology sector. Whatever happens, Zara pulls out its strings to escape from the industrial demand clutches. The following are some marketing strategies that helped Zara optimize its sales:
Production in small quantities
Zara has its conscience that fashion designing would change according to various incidents such as new post-covid fashion trends. Therefore, it has the habit of producing fewer quantities. Fewer quantities will be produced based on the design selected by fashion designers every month. The selected designs will then be manufactured in lower quantities. This is done to create a virtual demand in the minds of the customers who will have no other option than to buy the goods whenever it is available. So this helps Zara reduce any losses and acts as an ingenious inventory strategy.
Centralized production house
The basic idea of every industry is to produce different types of goods and to sell them by getting them from both in-house and merchandisers. The situation in the Zara organization is entirely different. Instead of discussing and wasting time about the product, Zara asks the merchandise owner to send the product sample. Zara is always focused on the market changes and will do anything to keep up with the market run, so getting samples is one of Zara’s marketing strategies.
Streamline of internal communication
Delegation of work is important in an organization. Effective delegation results in effective profits and prospects. Zara took the delegated responsibility way too high as there are various departments for various functions. The employees work to research on top fashion trends of each year to provide the best to their clients. The branches have separate departments to look after the designs, sales, and marketing improvements as per the economic and geographic locations. This helps Zara to implement effective strategies to recover the branches from the issues pressurizing them.
Zara is always known for its precise scheduling and time management in the business which is one of the best sale optimizing strategies used by them. The schedule also includes products’ ordering by the store managers of the Zara Corporation. Zara has its schedule management guidelines by which every store manager can order goods only two times a week because they keep changing up products to fit the current fashion trends. The ordered goods will reach the store as soon as possible without any delay and they will be displayed in the stores. By this, Zara reduces the constraints for the customers and also for its revenue earning opportunities.
GET HELP WITH YOUR SWOT REPORT
Zara is judged mostly because of its strong inventory strategy which helps it in being the most successful company of all time. The SWOT analysis is made to analyze the strength and the weakness of the company so that the same can be used to work on the weak areas. The Strength of Zara is its stock management whereas the weakness is the centralized production activity which involves many problems and the continuous order for business. The opportunity gained by Zara is the research of identifying the portable fashion ideas whereas the threat will be on the side of holding the markets.
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In house production capacity
As mentioned before, the designers will choose about 1000 designs every month for production. The production of 1000 designs based on the various factors involves a lot of investment. Therefore Zara doesn’t allow other manufacturers to have a production house for themselves where the goods will be manufactured at low cost and can be sold at affordable prices for the customers. The low-cost manufacturing will be an added advantage for the Zara Company to focus on the other aspects which is why this is one of the best sale optimizing strategies used by Zara.
Automated production and supply
Since Zara is capable of creating virtual demand; it might also run out of goods for further sales in its stores. The production in Zara is capable of identifying the surrounding demand and sales percentages in the company. It also identifies current trends such as post-covid fashion and many other ones. There is an automated production approach where no goods in the warehouse and also in the stores is available; Zara will start to produce automatically as per the request of the Company.
Sticking to the above-mentioned rules and strategies
As the strategies are laid, it must be followed without any breakage and must also have the obligation to adhere to the strategies and the company rules for effective functionality in the future. Zara makes sure that the mentioned rules are followed without any issues or problems. If there are any casualties, it is solved immediately to have a smooth transition in the business.
Understanding Zara’s marketing and inventory strategy
The existence of Zara in the market is due to the unique inventory strategy followed by it. Zara tends to produce limited quantities in its factory and will move the supply from the factory to the stores at regular intervals. The Zara Company has a central warehouse where the goods, after being manufactured, will directly go to that place. The centralized warehouse and stock inventory dispute are the two main advantages for the marketing activities. The Assignment Essay Help, on the other hand, is working based on the customer-centric service and usually works on the deadline prescribed by the customers. Clients approach marketing experts at Assignment Essay Help to get accurate results before the deadline.
The pandemic has destroyed many retail companies and their dreams of flourishing in the lifestyle and clothing apparatus. Zara still stands and survives the heated situation of imbalances and also focuses on the selling of fashion goods and keeping its inventory clean and ready for the next goods arrival.
Author Bio: With years of experience in digital marketing, Bella helps university students with their marketing assignments so that they can meet the desired learning objectives of their marketing course. She has also co-founded Top My Grades to help students with career counseling. Beyond work, you can find her digging into the upcoming trends in online marketing.