Zara What Is The Killer From A Tailor To Hundreds Of Millions Of People?

You must have heard of that.

Tycoon -

But do you know the father of ZARA, Ortega? He was born poor, his father was a railroad worker, his mother was a servant, and the poor two generation Ortega went to a tailor shop as an apprentice at the age of 13.

Throughout the rich list, most of them came from new industries like IT and the Internet, while Ortega came from the most traditional clothing industry.

How did he accumulate 100 billion worth of clothes by selling clothes? Nikos, Professor of operations management at CEIBS and director of Global EMBA program in Central Europe, will expose you.

The biggest killer of ZARA is fast!

First of all, in the clothing industry, from

It takes 6 to 9 months for the whole process to be purchased, and only two or three months for the design process.

ZARA only takes 2 weeks to complete the whole process.

Take logistics as an example, ZARA chooses air pportation instead of traditional shipping, so that the product can reach the store quickly. It only takes 36-72 hours to reach the world from Spanish factories, that is to say, the ZARA you wear on may be in Spain 36 hours ago.

In addition, ZARA sends feedback information from customers in the store to the designers at the headquarters through big data, and the designer changes quickly according to the feedback from customers.

The rapid response mechanism has brought a lot of money to ZARA. The customers who frequented the stores are ZARA banks. Their cash flows to the company headquarters.

Killer 2: no cost than flexibility.

Let's look at another anti tradition.

The gross profit of general garment enterprises will be relatively high, but usually net profit is very small.

Where have all the money gone?

Because enterprises usually have to consider the balance between supply and demand when making market forecasts. When forecasting exceeds demand, products will be surplus, and the final inventory will be disposed of by discount. When forecasting is less than demand, it will lose sales.

Businesses need to strike a balance between the two.

Most enterprises will produce more products than market demand.

But ZARA doesn't think about that.

Each product is produced in a small batch way, so its stock is very small.

It is constantly entering the new design cycle, and can even do 2 new shelves a week, allowing customers to frequent stores and reduce the gap between prediction and actual demand.

Who says enterprises must compete at low cost?

According to the world clothing and shoe net, ZARA logistics has chosen to choose relatively expensive air pportation instead of shipping.

In addition, the suppliers of ZARA 49% come from Europe, not Southeast Asia and other countries with lower labor costs.

Why does ZARA not play the cards regularly? How can such a high operating cost make money?

ZARA's inventory is very small as it greatly shortens the supply chain process and responds quickly to the market.

Second, the cost of advertising is particularly low, with only 0.3% of sales, and the average figure in this industry is 3~4%.

From the point of view of operation management, the competitiveness of enterprises is often considered from four aspects: cost, quality, speed and flexibility.

ZARA's success is the biggest inspiration for us: not all companies need to compete at low cost. ZARA has chosen the speed and flexibility of competition.

In the past, "made in China" depended on low cost.

With the gradual increase of China's labor costs and the gradual disappearance of demographic dividends, Chinese enterprises can also consider improving their competitive advantages from three other aspects.

It is worth noting that although China's labor costs are on the rise, the demand for the Chinese market is also rising, and the domestic market is becoming more and more popular. From Made in China to Made for China, Chinese enterprises should make such a timely change.

The reason is very simple. When the economy develops rapidly, people usually neglect operation management and pay more attention to developing the market. However, when the economy is down, people will pay more attention to how to improve efficiency and reduce costs.

At this time, we need to constantly adjust strategies and optimize our own processes.

At this point, for Chinese enterprises, "operation management" will become more important.

More interesting reports, please pay attention to the world clothing shoes and hats net.