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19 March 2012 08:14

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Just-in-Time Fashion --- Spanish Retailer Zara Makes Low-Cost Lines in Weeks By Running Its Own Show
By Carlta Vitzthum. Wall Street Journal [New York, N.Y] 18 May 2001: B.1.

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Abstract
Much of the success is due to Zara's unusual structure. Unlike competitors such as Gap Inc. and Sweden's Hennes &Mauritz AB, which operates the H&M clothing chain, Zara produces more than half of its own clothes, most of it at its ultramodern complex here in northwestern Spain. Zara makes 40% of its own fabric -- far more than most of its rivals -- and the pieces are sewn together at 400 cooperatives run by local seamstresses. At its base here in Spain, Zara also operates its own world-wide distribution network. Controlling the whole chain of production gives the company flexibility that competitors like Benetton SpA of Italy don't have. It also enables Zara to operate with almost no costly inventories; stores get deliveries twice a week and items rarely remain on the shelves for more than a week. "Zara is a strong competitor which we greatly admire," Benetton spokeswoman Emma Cole says. "We are two apparently similar groups, though in reality we have greatly differing projects and characteristics." Certainly, being so quick also has drawbacks. If consumers have any complaint, it's that Zara 's clothes often don't last as long as many would like. "Zara makes really trendy stuff at very accessible prices, but the quality isn't always that great," says Colleen van Cleave, a Canadian translator who shops at Zara in Spain. Zara says improving quality has been one of its main goals and that the results can be seen in some of its lines, particularly in its professional clothing for women.

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Full Text
A CORUNA, SPAIN -- Beatriz Padin knows Zarais on to something: The clothing retailer's new khaki skirt has already sold out and it's been on store shelves here for just a few hours. Ms. Padin -- whose job as a comercial is part designing, part fashion reconnaissance -telephones Barcelona. Sales there are also brisk. About 2,800 skirts were sent out during the night to some of Zara's 449 stores world-wide -- just enough to test the waters. The results are clear: The skirt is a hit. With a mix of intelligence gathering, fashion instinct and technological savoir-faire, Ms. Padin is setting in motion something unique in the clothing trade: just-in-time low-cost fashion.

Within days, Zarastores in Europe, Asia, and North and South America will be stocked with the khaki skirt. Such a quick response enables Zarato offer the latest fashions at reasonable prices in such upscale locales as the Champs-Elysees in Paris and Lexington Avenue in New York. Created in 1975, Zarais the largest and most profitable unit of Inditex SA, the Spanish clothes manufacturer and distributor whose 2.3 billion euro ($2.03 billion) initial public offering earlier this month quickly became one of the biggest and most successful in Europe this year. Zaraaccounts for 78% of Inditex's retail sales, which totaled 2.6 billion euros last year. Much of the successis due to Zara's unusual structure. Unlike competitors such as Gap Inc. and Sweden's Hennes &Mauritz AB, which operates the H&M clothing chain, Zaraproduces more than half of its own clothes, most of it at its ultramodern complex here in northwestern Spain. Zaramakes 40% of its own fabric -- far more than most of its rivals -- and the pieces are sewn together at 400 cooperatives run by local seamstresses. H&M, in contrast, has 900 suppliers and no factories. "We think the way we have structured our organization gives us a competitive edge," H&M spokeswoman Annacarin Bjorne says. "Our suppliers have factories with different specialties, which enables us to give customers the broad variety of clothes we have in our stores." At its base here in Spain, Zaraalso operates its own world-wide distribution network. Controlling the whole chain of production gives the company flexibility that competitors like Benetton SpA of Italy don't have. It also enables Zarato operate with almost no costly inventories; stores get deliveries twice a week and items rarely remain on the shelves for more than a week. "Zarais a strong competitor which we greatly admire," Benetton spokeswoman Emma Cole says. "We are two apparently similar groups, though in reality we have greatly differing projects and characteristics." Zaratakes only four to five weeks to design a new collection and then a week to make it. With its team of comercials sniffing out new fashions while keeping in constant contact with store managers, the company can spot and react to trends quickly, including taking something stylish off a music video. Other retailers, in contrast, need an average of six months to design a new collection and then another three months to manufacture it, according to Inditex Chief Executive Jose Maria Castellano. "Fashion expires, much the same way yogurt does," he says. "Being so quick allows us to reduce to a minimum the risk of making a mistake -- and we do make mistakes -with our collections." Certainly, being so quick also has drawbacks. If consumers have any complaint, it's that Zara 's clothes often don't last as long as many would like. "Zaramakes really trendy stuff at very accessible prices, but the quality isn't always that great," says Colleen van Cleave, a Canadian translator who shops at Zarain Spain. Zarasays improving quality has been one of its main goals and that the results can be seen in some of its lines, particularly in its professional clothing for women. Zara's designers are always on the prowl for new fashion trends. Ms. Padin and colleague Mercedes de las Heras, for example, look through stacks of fashion magazines, attend

fashion shows and frequent fashionable cafes, restaurants and bars. "It's good to listen, particularly to customers. They know better than anyone what they want," Ms. Padin says. "We're like sponges," says Rafael Pastor, another fellow designer. "We soak up information about fashion trends from all over the world." Sitting at his desk, Mr. Pastor checks real-time sales on his computer to see what items from last night's delivery are selling and where. Pants and shirts embroidered with flowers are still hot, particularly in Catalonia. Long, flowing plaid skirts are popular in Kuwait and other Arab countries. After selling well in Asia earlier this year, dresses with camouflage motifs are big in France and Lebanon. But stripes are outselling camouflage in Spain. Zara's designers are constantly updating and mixing and matching popular styles -- rather than flooding the market with a single item -- so that no single model is on the market for more than a couple of weeks. "No one wants to dress like everybody else," Ms. Padin says. "It's important always to have fresh fashion." The semiweekly deliveries help keep Zarastores seeming fresh, and store clerks heighten the sense of rapid turnover by changing the location of key items. "Turnover is so high that consumers are under pressure to buy," says Jose Luis Nueno, a retailing professor at the University of Navarre's graduate business school in Spain, who conducted a four-year study of Zara's sales. "There's always the feeling that if they don't buy now, they'll lose their opportunity." He says Zara's strategy has paid off with a growing pack of devotees. "There's nothing like it anywhere," he says. Credit: Staff Reporter of The Wall Street Journal

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Indexing (details)
Subject Fashion; Just in time; Clothing Zara Just-in-Time Fashion --- Spanish Retailer Zara Makes Low-Cost Lines in Weeks By Running Its Own Show Wall Street Journal B.1 0 2001 May 18, 2001 2001 New York, N.Y. Dow Jones&Company Inc New York, N.Y.

Company/organization Title Publication title Pages Number of pages Publication year Publication date Year Publisher Publisher Place of publication

Country of publication Journal subject ISSN Source type Language of publication Document type Subfile ProQuest document ID Document URL Copyright Last updated Database

United States Business And Economics--Banking And Finance 00999660 Newspapers English News Fashion, Just in time, Clothing 398763419 http://search.proquest.com/docview/398763419?accountid=13552 Copyright Dow Jones&Company Inc May 18, 2001 2010-06-26 ProQuest Central << Link to document in ProQuest

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