Sourcing: Zara - Unique Supply Chain Management

Running head: SOURCING
Sourcing: Zara
Name of the Student
Name of the University
Author’s note

1SOURCING
Sourcing/ purchasing are the process in supply chain management where a company
includes an external service provider within the operations of the organisation (Fernie and Sparks
2014). Zara is a fast fashion retail chain which operates under the Spanish company Inditex, One
of the major objectives of the company is to achieve growth through diversification; hence the
company keeps refreshing its stock once in two weeks. The competitive advantage of the
company is the establishment of the quick supply chain which is driven by the process of
procuring small amount of inventories which in turn results in reduction of waste (Inditex.com
2018). Due to the requirement of the company to refresh the products, Zara has a prominent
designer and marketing departments that continuously source the market in order to cater to the
requirements of the target market.
Supply chain management of Zara
Zara has a unique supply chain management function which helps the company gain an
edge over the competitors by keeping the cost of the products reasonable. As the organisation
operates in the fast-fashion industry the company has to re-fresh the stock of garments quickly.
Zara has a centralized and vertically integrated Supply Chain management process. The supply
chain of the company can be described as lean and agile as the waste is decreased due to less
usage of inventory and rapid change of products. The majority of the manufacturing process of
the company is owned by the management, Zara has its own manufacturing units approximately
22 in number, and this allows the company to be agile as well as reduce the waste in the process
of operation. This also helps the company to maintain the quality and monitor the efficiency. The
retail outlets take deliveries two times in a week, and a time span of two days are taken in order
to deliver the items. The approach that the company has towards the supply chain is JUST IN

2SOURCING
TIME method where the company focuses on the trends of the market (Qrunfleh and Tarafdar
2014).
Suppliers
The minority of the production process which is not undertaken by the company is done
by the suppliers who are chosen on the basis of the following: quality, worker wage, Flexibility.
Sourcing Zara sources its products from Europe, Asia and Africa as the labour of the country in
this region is relatively cheaper than that of European countries or US. As the company keeps
refreshing the stock rapidly at least once in two weeks, the supply of the products has to be in the
process all the time and as it has to change so quickly the factories need less investment in
stocking the raw materials. The company focuses on the quality of the products and ensures best
equipment in the process (Chow et al. 2008).
 50% of all items are manufactured in Spain
 26% in the rest of Europe
 24% in Asia and Africa
One of the major advantages of integrated process is that the majority of the quality is under
the direct control of the company and the major demerit of the process is that it can bring
complexities in the business operation.
Sustainable sourcing
Triple bottom line concept
This is a contemporary concept in marketing where the company not only focused on the
financial improvement and development of the company, but also realizes the responsibilities